Shared Services
In SA Local Government
September 2012
Shared Services in SA Local Government
Local Government Association of South Australia - Report
CONTENTS
1.
Introduction ............................................................................................................... 2
2
Working Together For Stronger Communities Program – Review Findings ............... 3
2.1
Eyre Peninsula Local Government Association - Investigation Of Better Local
Government Service Delivery For The Region........................................................... 3
2.2
The Far North Councils – Development Of A Shared Services Model – A Sustainable
Future For Local Government .................................................................................... 3
2.3
Adjoining Se Coastal Councils (Robe And Kingston) – Joint Delivery Of Engineering
Services .................................................................................................................... 3
2.4
South East Local Government Association - Common Policy And Specification
Documentation For Councils Procurement ................................................................ 3
2.5
Fleurieu Councils – Governance Structures To Formalise Regional Cooperation ....... 4
2.6
Eastern Regional Alliance – Sharing General Inspectorial And Building Inspection
Services. ................................................................................................................... 4
3.
Lga Shared Services Models (Including Lgfa)............................................................ 5
3.1
Lga Workers’ Compensation Scheme ........................................................................ 5
3.2
Local Government Mutual Liability Scheme ................................................................ 6
3.3
Local Government Income Protection Fund (The Fund) ............................................. 6
3.4
The Local Government Asset Mutual Fund (The Fund) .............................................. 7
3.5
Local Government Finance Authority.......................................................................... 7
4.
Other Research Findings ........................................................................................... 7
5.
Shared Services - Where To Next? ........................................................................... 9
Appendix 1 .......................................................................................................................... 11
Appendix 2 .......................................................................................................................... 41
Appendix 3 .......................................................................................................................... 53
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Shared Services in SA Local Government
1.
INTRODUCTION
The Independent Inquiry into the Financial Sustainability of Local Government in October
2005 recommended “that in canvassing alternative methods of delivery, Councils consider
further resource-sharing initiatives, especially involving the smaller Councils, ranging from
working together more effectively to more formalised regional groups, area integration and
whole-of-sector initiatives.”
The Inquiry Report recognised that the Local Government Association of South Australia
(LGA) has a strong track record of undertaking shared services demonstrated by the
provision of sector wide workers‘ compensation indemnity insurances support and risk
management services via the LGA’s Workers Compensation and Mutual Liability Schemes.
These schemes are subsidiaries of the LGA and operate under rules determined by the
LGA. Delegated authority is provided by the LGA to the management boards of these
Schemes to undertake day to day management.
Another shared service that is nationally recognised is the Local Government Finance
Authority (LGFA) which operates under its own legislation.
The Report also recognised that many Councils, particularly small or country Councils,
participate in localised shared services arrangements eg. sharing planning, inspectorial,
environmental officers and that a number of regional LGAs collaborate to undertake S30
Reviews under the Development Act. It also recognised that there was still more scope for
shared services in Local Government.
In 2006, the LGA commissioned a further survey to identify the extent of shared services
occurring in Local Government and to establish the potential for new opportunities. A forum
was held to explore the information gathered through the survey and this provided direction
for the next steps to be taken by the sector with guidance from the LGA. Appendix 1 sets out
the findings of the survey published in 2007.
Funding was then secured by the LGFA to support the exploration of shared service
opportunities in Local Government in South Australia. This funding was made available to
the LGA. In 2009 the LGA, working in partnership with participating Councils, established a
program (Working Together for Stronger Communities) 1 to facilitate a number of pilot shared
services projects to:
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explore and identify opportunities for collaborative resource sharing;
examine the feasibility, capacity and options available to deliver the shared
services/s outcomes;
engage the key stakeholders in the required decision making processes; and
where relevant, jointly manage the implementation of the agreed service delivery
changes.
This paper reviews the shared services journey thus far, identifies the lessons of the pilot
projects established by the LGA’s Working Together for Stronger Communities Program and
proposes a new model for approaching shared services in the regions.
1
The details of the Working Together for Stronger Communities Program are provided at Appendix 2
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WORKING TOGETHER FOR STRONGER COMMUNITIES PROGRAM – REVIEW
FINDINGS
2
Following an invitation to all Councils the LGA provided initial support to Local Government
Regional Associations and participating Councils by way of consultants who assisted
Councils in scoping projects. The projects are outlined below, along with a brief overview of
the scope of the project, outcomes and funding provided.
A copy of the complete report is attached (Appendix 3).
2.1
Eyre Peninsula Local Government Association - Investigation of Better Local
Government Service Delivery for the Region
This project identified three areas as opportunities for shared services:
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Governance;
Human resources (HR) including regional workforce and succession planning,
regional education and training plan and programs, OHS and risk management
services, standardisation of HR policies, systems, and procedures, regional
development for the delivery of human resource services; and
Waste management.
The LGA contributed $41,668 to this project.
2.2
The Far North Councils – Development of a Shared Services Model – A
Sustainable Future for Local Government
This pilot project initially involved four Councils (Peterborough, Flinders Ranges, Orroroo
Carrieton and Mt Remarkable); Flinders Shared Services Group. Peterborough later
withdrew.
The project envisaged the creation of a regional subsidiary for the provision of Corporate
Services. This identified significant financial benefits to Councils.
The LGA contributed $30,000 to this project.
2.3
Adjoining SE Coastal Councils (Robe and Kingston) – Joint Delivery of
Engineering Services
This project involved the sharing of the delivery of engineering services between the Robe
Council and the District Council of Kingston.
The LGA contributed $8,000 to this project.
2.4
South East Local Government Association - Common Policy and Specification
documentation for Councils procurement
This pilot project involved the South East Local Government Association (SELGA) Councils
(The District Councils of Grant, Kingston, Naracoorte Lucindale, Robe, Tatiara, Wattle
Range and the City of Mount Gambier).
The pilot project focussed on the development and implementation of common policy and
specification documentation for Councils procurement activities.
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The LGA contributed $23,620 to this project.
Fleurieu Councils – Governance Structures to Formalise Regional Cooperation
2.5
The objective of this project was to identify a formal governance structure to support
collaborative arrangements for regional economic development and other key regional
initiatives in order to improve the long term sustainability of the Fleurieu and Kangaroo Island
Councils and their region.
This project was between four Councils; the Alexandrina Council, the District Council of
Yankalilla, the City of Victor Harbor and the Kangaroo Island Council.
The LGA contributed $14,732 to this project.
Eastern Regional Alliance – Sharing General Inspectorial and Building
Inspection Services.
2.6
The Eastern Region Alliance (ERA) (seven Metropolitan Councils; Norwood, Payneham and
St Peters; Prospect; Campbelltown; Walkerville; Unley; Tea Tree Gully and Burnside)
agreed to undertake a pilot project exploring the sharing of Building Inspectorial function and
General Inspection Services.
The LGA contributed $6,700 to this project.
Summary of Findings:
The evidence gathered as part of this review indicates that the Working Together for
Stronger Communities Shared Services pilot projects appear to have had limited success in
terms of achieving pilot project outcomes. However, a review of the experience of
participants has provided some valuable information about the lessons learnt. It also seems
that most participants are still keen to pursue further opportunities for shared services in the
future.
Out of the six pilot projects:
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two have developed guidelines and template documents; one for human resources
and the other procurement. While there appears to be no problems with the
documentation provided it seems that in the case of one pilot project these
documents are not fully utilised by all the participating Councils;
two did not advance past the scoping phase;
one has been unable to advance to what participant’s consider to be the next stage
due to the need for further funding, and
one pilot project, which evolved into a shared services project with a different scope
ie. sharing building and development rather than engineering services, is considered
to be a sustainable arrangement.
With regard to challenges and pitfalls the most common issues identified were:
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the need to have commitment from all the CEOs and senior staff; buy in from day
one, a genuine desire by the parties to share services, resources or have other
collaborative arrangements;
difficulties associated with different sized Councils ie. bigger Councils may not get
the benefits which may influence their level of participation in shared services or
collaborative arrangements;
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the need for time and resources to be dedicated to the project;
other distractions and changes in CEOs can either slow or stop the project
completely;
need for an individual or group that is passionate, a driver of the project to ensure the
project gets over the line;
the need to move above the political and parochialism to the strategic regional level;
and
being distracted by other priorities and core business.
In addition, it appears that Councils who already had other collaborative arrangements in
place and had subsequently built positive relationships found this assisted them in the pilot
project.
Overall it seems that Councils recognise that there are benefits in undertaking collaborative
arrangements with other Councils and are committed to exploring such arrangements
further.
A number of Councils that participated in the pilot projects already had collaborative
arrangements in place. It appears from the information provided that the most common
arrangement seems to be the sharing of resources. There were two groups that identified
they had established a formalised regional structure ie. a regional waste subsidiary and the
regional health authority.
3.
LGA SHARED SERVICES MODELS (INCLUDING LGFA)
When considering the success of Shared Services models within the South Australian Local
Government Sector, special consideration should be given to the centralised “schemes”
operating as part of the Local Government Association, SA.
LGA Workers’ Compensation Scheme
3.1
The LGA Workers’ Compensation Scheme (LGAWCS) was formed in 1986 and provides
Local Government with a fully integrated claims, rehabilitation and occupational health and
safety service. The LGAWCS is recognised in the Local Government Act 1999.
All Councils are members of the Scheme and therefore participate in the industry self
insurance structure that is managed through the mutual fund concept. The Scheme is a
subsidiary of the LGA and day to day management occurs through a Board that reports to
the LGA State Executive Committee
The LGAWCS delivers significant cost advantages to South Australian Councils with the
provision of:
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tailored OH&S that is structured around interpretation of industry statistics;
specialist claims management services;
rehabilitation support for injured employees;
legislative advice and training support;
health & wellbeing programs; and
positive financial outcomes that include incentive based programs.
All Councils in South Australia are members of this Scheme which delivers the benefits of
self- insurance to the sector.
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3.2
Local Government Mutual Liability Scheme
The Local Government Association Mutual Liability Scheme (LGAMLS) was established in
1989 by the Local Government Association of South Australia (LGASA) as a service provider
to protect and assist Councils manage their civil liability risks and claims. The LGAMLS is
recognised under the Local Government Act 1999.
In the years prior to its establishment, Councils were experiencing significant challenges in
obtaining public liability and professional indemnity insurance cover at affordable levels.
The aftermath of the 1980 “Ash Wednesday” bushfires in the Mount Lofty Ranges, a
significant “hardening of the insurance markets” and a limited number of insurers willing to
underwrite Local Government Authorities created an extremely difficult environment.
Reflecting back, the problems faced by the Local Government Industry at that time have
many similarities to the public liability crisis currently being experienced.
Whilst membership of the LGAMLS is voluntary, the Scheme has maintained 100%
membership of the Councils in South Australia since 1992. This is primarily because
Councils have seen the long-term benefit and value afforded by the range of risk
management and claims management services provided.
The objectives of the LGAMLS are clear. Members are provided with:
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assistance and advice with respect to the management of potential and actual civil
liabilities;
risk minimisation and risk management advice and services;
assistance and legal representation with respect to civil liability claims; and
financial assistance with respect to managing civil liabilities.
The LGA Mutual Liability Scheme (LGAMLS) provides South Australian Councils with a fully
integrated risk, claims and legal advisory service for civil liabilities.
The Scheme is a subsidiary of the LGA and day to day management is undertaken by a
Board which reports to the LGA State Executive Committee.
3.3
Local Government Income Protection Fund (the Fund)
The Local Government Income Protection Fund is a self-insurance Mutual Risk Product
created for the benefit of Local Government Authorities and their employees.
The Fund is a subsidiary of the LGA and day to day management is undertaken by a Board
which reports to the LGA State Executive Committee.
The benefits of the Fund include;
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outside working hours Accident and Illness payments;
100% reimbursement of wages;
104 week maximum benefit period;
Death and Capital Benefit $15,000; and
workers’ compensation top up benefit.
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3.4
The Local Government Asset Mutual Fund (the Fund)
The Fund is a commercial arrangement between the LGA and Jardines Insurance Pty Ltd
and provides insurance for the vast range of assets managed by Local Government. When
it commenced in 2002, it became the third Local Government self insured fund established in
South Australia.
Benefits of the scheme include;
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3.5
cost effective protection of assets including property, structures, contents, computer
equipment, machinery, motor vehicles (both heavy and light vehicles) fidelity
guarantee;
risk Management services and programs that support the management of assets;
specialised claims management support; and
a mutual industry approach that supports positive financial outcomes and minimises
the effects of external influences.
Local Government Finance Authority
The LGFA is a competitive source of funds established to service Local Government
exclusively. It is a corporate entity, established under its own Act in 1983.
Whilst all Councils are able to access LGFA funds, the decision to do so remains voluntary.
Those Councils that choose to use the services of the LGFA receive an annual bonus based
on the Authorities performance.
It is managed by a Board of Trustees.
Although not part of the Crown, Section 23 of the LGFA Act outlines the agreement for the
South Australian Treasurer to guarantee all of the Authority’s liabilities including monies held
on deposit from clients.
Councils that make use of the LGFA services, enjoy an annual bonus when the annual
earnings are redistributed to the Local Government clients.
The LGFA makes payments equivalent to Company Income Tax directly into a fund (the
Local government research and development Fund) that is used exclusively for the benefit of
South Australian Local Government. The funds in this account are available for Local
Government development purposes based on recommendations by the LGA that have the
support of the South Australian Minister for Local Government. It is a requirement that the
LGFA has no involvement in the control or dispersion of funds from this account.
4. OTHER RESEARCH FINDINGS
The experience of the participant Councils in the Working Together for Stronger
Communities Shared Services Projects seems consistent with a number of pieces of
research that have been undertaken in this field most notably by the Australian Centre for
Excellence in Local Government (ACELG).
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In 2011, the LGA, ACELG and Local Government New Zealand produced a report;
Consolidation in Local Government a Fresh Look2 which found that
“Shared Services may also enhance strategic capacity to varying degrees, but this would
appear to require more robust and powerful regional structures – such as semiautonomous arms length entities. This may in turn have impact on local democracy …
Looser forms of regional collaboration are least likely to deliver substantial strategic
capacity.“
In addition, it produced the following headline conclusions:
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ongoing change in Local Government is unavoidable, and consolidation in its various
forms will be part of that process;
as a general rule benefits of some sort do accrue when Councils adopt mechanisms
to collaborate or consolidate with other local authorities;
potential benefits are reduced or lost when the process is flawed due to inadequate
planning and consultation or failure to consider all the options available and
precisely what each could achieve;
there is little evidence that amalgamation will automatically yield economies of scale;
efficiency gains can be achieved through various forms of consolidation, but are
unlikely to produce reductions in local rates and charges due to other expenditure
needs;
what is more obvious is that various forms of consolidation have the capacity to yield
economies of scope;
more importantly, consolidation offers opportunities to achieve economies of scope
or enhanced strategic capacity. This effect may well be strongest in the case of
amalgamation into relatively large units;
new Services and/or innovative approaches to service delivery have been promoted
through various forms of consolidation;
in the case of more remote Councils with small population spread over large areas,
consolidation (whether amalgamation or shared services) may not be feasible;
concerns for any diminution of local democracy were muted, suggesting that
Councils may be managing this issue well and/or that it is often not a major, ongoing
factor in the eyes of the community;
underpinning any approach to consolidation is the importance of political leadership,
good governance and effective management arrangements, both in managing
change and establishing a sound basis for ongoing operations;
there is a continuing role for state (and national) Governments and Local
Government associations in facilitating and supporting consolidation initiatives; and
too much attention is focused on the institutional arrangements of the Local
Government system in each jurisdiction rather than on the fundamental issue of the
societal functions performed by Local Government and it changing role.
In 2012, ACELG produced Legal and Governance Models for Shared Services in Local
Government (interim report)3 which built on the earlier work and outlined the following as
pre-conditions to successful shared services arrangements:
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structure and governance;
shared Services design; and
plan for success.
2
Aulich C., Gibbs M., Gooding A., McKinlay P., Pillora S., and Sansom G. (2011) Consolidation in Local Government: A
Fresh Look, Australian Centre for Excellence in Local Government, University of Technology, Sydney.
3 Somerville, D. and Gibbs, M. (2012) Legal and Governance Models for Shared Services in Local Government, Australian
Centre for Excellence for Local Government, university of Technology, Sydney
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It also reflects some of the lessons of the LGA’s own experience and nominates the
following attributes of structure and governance considered essential to the success of a
shared service:
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Chief Executive Officer (CEO) commitment, coupled with political commitment and
the commitment of each local authority management team;
there must be passionate advocates within each local authority;
willingness to invest time and energy into building relationships with staff from other
local authorities;
the shared service entity needs a culture of its own, separate from the individual local
authorities;
the business structure must enable the shared service to conduct business with
external parties from a position of strength;
there must be equal rights in decision–making and influence over the activities of the
shared service;
the governance group must meet regularly with a key focus on monitoring
performance and evaluating strategic direction and new opportunities;
the governance group must be proactive and drive the strategic vision and thinking;
the members of the governance group must view their work on the shared service as
an ordinary part of their job;
use professional external support in drafting key documents;
use third party facilitator when establishing a new shared service structure, adding
new members or when considering strategic direction;
foster transparency and trust across the board, and share the goals, activities and
performance of the shared service with politicians, management teams and staff; and
match great ideas for shared services with a structured project management
methodology and resource.
5. SHARED SERVICES - WHERE TO NEXT?
As mentioned earlier in this report, The Independent Inquiry into the Financial Sustainability
of Local Government in October 2005 recommended “that in canvassing alternative methods
of delivery, Councils consider further resource-sharing initiatives, especially involving the
smaller Councils, ranging from working together more effectively to more formalised regional
groups, area integration and whole-of-sector initiatives.”
While not all pilot projects in the LGA’s Working Together for Stronger Communities Shared
Services Program achieved the stated project objectives, there remains both a continuing
commitment to working collaboratively and recognition of the role that LGA leadership plays.
There also continues to be recognition that developing models for collaboration that address
the lessons learnt in the Working Together for Stronger Communities Program will benefit
Local Government and its capacity both to deliver services to the community and to achieve
compliance with its various statutory responsibilities.
The LGA has recognised the success in the provision of shared services with its Schemes
being cited as an example of a successful model. The LGFA was also seen as offering a
valuable shared service to the whole of Local Government in South Australia.
It is therefore recommended that the LGA:
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seek support from a Local Government Region that would be prepared to consider
using its regional LGA (a Section 43 regional subsidiary) as a potential host or
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provider of one or more regional shared services, and to explore services that may
(subject to the regional subsidiary’s charter) be provided through this structure; and
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explore the viability of establishing a “regional office” of the LGA to act as a shared
services provider, in agreed areas.
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APPENDIX 1
REVIEW OF SOUTH AUSTRALIAN LOCAL
GOVERNMENT JOINT SERVICE DELIVERY
OPPORTUNITIES
ANALYSIS OF COUNCIL RESPONSES TO A
SURVEY AND OPTIONS FOR IMPLEMENTATION
OF VARIOUS RESOURCE SHARING MEASURES
PREPARED BY
Tony Lawson
Tony Lawson Consulting
February 2007
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Background
Among its various findings, the Independent Inquiry into the Financial Sustainability of
Local Government recognised that there are many forms of co-operation/integration
currently operating between Councils but challenged Councils to do more. Specifically
the Inquiry report recommended:
“11.2 (1)
That, in canvassing alternative methods of delivery, councils consider
further resource-sharing initiatives, especially involving the smaller
councils, ranging from working together more effectively to more
formalised regional groups, area integration and whole-of-sector
initiatives.”
In order to promote greater efficiencies and savings through increased co-operation
between Councils the LGA released Information Paper 7: Service Delivery Framework
including the Role of Shared Services, which identifies a range of strategies for the
delivery of services by Councils through shared or collaborative arrangements.
In November 2006 the LGA, in consultation with Local Government Corporate Services
(LGCS), commissioned a comprehensive sector-wide survey to capture examples of
what is currently occurring between Councils, the nature of savings being achieved and
opportunities to enhance collaborative service delivery. The survey also gathered
information regarding the number and nature of services that Councils are currently
collaborating on and the structural arrangements for the joint delivery of services. This
report provides an analysis to the LGA and the LGCS of the results and information
arising from that survey.
The report makes suggestions about the processes which need to be adopted in order to
develop robust and sustainable resource sharing initiatives including the development of
business cases where appropriate and provides specific recommendations for
appropriate next steps.
The report will provide Councils with information about current shared service
arrangements across the sector and highlight areas where opportunities might exist for
them to enhance the extent of their collaborative activities. The report does not provide
a rationale for shared services, except to note that the reasons for and benefits derived
from shared services arrangements are multi dimensional and do not relate solely to
financial imperatives.
The Survey Instrument
The survey questionnaire was circulated to all Councils via LGA Circular 42.6 dated 16
October 2006 (copy attached) and sought information in relation to the following 3
questions.
Q1. What joint service delivery arrangements has your Council implemented?
Q2. What joint service delivery arrangements is your Council actively considering, or
would like to implement, but has not yet done so?
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Q3. What other resource sharing opportunities would be worthy of future
investigation?
In answering these questions Councils were asked to provide detail, where appropriate,
against a range of headings.
The questionnaire sought a description of the delivery models used and the functions
covered in the arrangement (eg waste, IT, human resources, payroll etc). It was
suggested that reference to Information Paper 7 on the role of Shared Services which
contains an overview of resource sharing models and approaches may assist in
answering these question eg Subsidiary/Regional Subsidiary, Regional Associations of
Councils, Council to Council, Lead Councils, Private Sector Direct, Private Sector
Management etc.
Councils were also asked to indicate whether the service is ‘internal’ i.e. a service to
Council, or ‘external’ i.e. a service to the community and to indicate the estimated cost
savings and other benefits that are being currently achieved or that potentially would
result for the Council and the community.
Information was sought on the reasons for selecting a particular model with the following
suggestions offered: optimising people and their skills, better utilisation of assets, time
and other resources, concentration of functions either geographically or through a form
of communication link, maximising the use of an investment etc.
The questionnaire also sought information on the achievements and other accountability
issues and a description of both the positive and negative lessons learned from the
shared service activity.
Responses Received from Councils
The survey received a good, representative response from Councils (a total of 34
Councils which represents a response rate of 50% of the 68 South Australian Councils).
Of the 34 responding Councils 24 (71%) were regional/rural Councils and 10 (29%) were
metropolitan. The proportions of regional/rural and metropolitan Councils responding
were 48% and 56% respectively. A listing of the responding Councils is at Attachment 1.
As the analysis contained in this report is based on a 50% sample of all Councils some
caution should be exercised in drawing conclusions about the range and extent of
resource sharing initiatives being undertaken in SA as there may be a number of
creative and exciting initiatives that were not reported.
Analysis of Responses to the Survey
Three tables presenting the detail of responses received to the 3 main questions asked
of Councils are included at Attachment 2 along with a table summarising key issues
identified from the analysis.
The responses to the survey suggest there is a wide range of resource sharing
opportunities. The following highlights a number of areas that could be further
developed.
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Waste Management
This service area is the most common for examples of resource sharing. This is not
surprising given the cost of waste management, increase in waste levies, the EPA
requirements for the management of landfills and the SA Government’s targets to
achieve zero waste. It would appear that there may be further opportunities to share
resources in the delivery of services in this area through the creation of a smaller
number of (but larger) strategic regional waste management resource sharing
arrangements designed to achieve greater economies of scale and improved
management of this activity. The success and wide acceptance of resource sharing in
this service area provides a positive template for other resource sharing arrangements.
Environmental Health/Building Assessment & Inspection/Development Assessment &
Town Planning
These service areas are of concern in regional/rural Councils where it is difficult to attract
qualified staff and giving rise to a significant number of resource sharing arrangements in
place for this service area. The majority of collaborative arrangements are through
Council to Council reciprocation and it would appear there are opportunities to provide
for these services more on a regional resource sharing basis via larger groupings of
Councils serving as regional sponsors and employers of skilled staff through the
development of regional cadetship/trainee schemes and relief staff pools.
Sharing/Purchasing of Physical and Other Assets
There are many examples of regional/group resource sharing arrangements in this
service area which could provide templates for more regional resource sharing which
would result in greater economies of scale, reduced costs and reduced duplication of
effort.
Back Office Operations (Including Payroll, Human Resources, Financial Management,
Rates and Levies Collection )
This is a prime service area for resource sharing given the similarity in processes
between Councils. There may be some sensitivity around potential job losses but this
would need to be offset against cost savings through economies of scale, improved
productivity and access to specialist expertise and reduction in duplication. The most
common model of shared delivery would be by Council to Council reciprocation. The
need appears to be greater in regional/rural areas but there is no reason why this would
not also be significant in the metropolitan area. Given the sensitivity involved the
introduction of changes in this area would require a high level management and
consultation.
Access to IT Services
This is also a prime service area for resource sharing given the similarity in processes
between Councils. There is an issue of compatibility of hardware platforms but the
experience in other sectors suggests that these issues could be satisfactorily resolved.
Governance, Compliance and Audit Services
The need in this service area applies equally to the metropolitan and regional/rural areas
and is recognition of the need for specialist skills, reducing duplication and achieving
greater collaboration through Council to Council reciprocation. It is suggested that given
the importance of governance and compliance it is somewhat surprising there are not
more arrangements in place and it is a service area which lends itself to resource
sharing.
Analysis of Responses to a Council Survey – Tony Lawson Consulting – February 2007
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Other Initiatives
There are a number of individual initiatives which are the subject of resource sharing
arrangements being undertaken by Councils, which may have broad application to the
Local Government sector more generally. It is suggested that there needs to be an
improved mechanism for informing Councils of the vast array of resource sharing
opportunities. For example it is interesting to note that only 1 Council referred to the joint
purchasing of legal services, which would appear to be an area worthy of further
investigation given that all Councils have a need for and draw on the services of legal
firms.
Other Key Observations from the Analysis of Surveys
1. The rationale and imperatives for resource sharing activities do not appear to be
totally related to financial benefits in achieving economies of scale and reducing
costs although this was cited for a large number of initiatives. Reasons given for
entering into resource sharing activities related to Councils providing leadership
in their communities and ensuring services are provided which may not be
provided through the market place. This appears to be more pronounced in
regional/rural areas than in the metropolitan area. Some striking examples
include management of a football league and providing housing for medical
practitioners.
2. While Councils identified financial savings as a key reason for entering into
resource sharing activities only a small number provided an estimate of the dollar
savings achieved from such pursuits.
3. While a number of Councils indicated that the joint service was provided to
provide a community benefit they were also concerned that Councils should not
be drawn into assuming roles which should be performed by other spheres of
government.
4. Regional and rural Councils appear to have more resource sharing initiatives in
both human resources and physical assets than their metropolitan counterparts
due mainly to the small size of their financial base and their capacity to employ
and attract professionals in a range of areas.
5. Council responses did not reveal new examples of resource sharing initiatives
which are not currently in practice somewhere in South Australia.
6. A majority of Councils referred to membership of Regional Associations,
PLAIN/Library agreement, Central LG Services eg Mutual Liability. As a majority
of Councils are members of regional associations and participate in PLAIN
arrangements, central Local Government services and programs such as HACC
these are not listed separately. However, it was interesting to note that a number
of associations of Councils are investigating or undertaking resource sharing
activities. It is suggested that these organisations may provide a sound basis for
the development of new and additional initiatives and therefore these
organisations should be encouraged and assisted to develop even more
initiatives across the board.
Analysis of Responses to a Council Survey – Tony Lawson Consulting – February 2007
DME: 89507
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Appendix 1
Review of SA Local Government Joint Service Delivery Opportunities
7. It would appear that while a number of Councils referred to services provided by
LGCS, there may be a lack of broad understanding of the full range of services
provided. Some Councils indicated that the provision of after hours emergency
contact should be provided or investigated however it is noted that LGCS has
implemented this type of service through the RAA.
Options for Implementation of Various Resource Sharing Measures.
The first observation is that the survey response was quite high and so the results are
expected to represent the range of joint service activities being undertaken by Councils
however it is possible that there are some other resource sharing practices being
undertaken by Councils that have not been identified in the survey results.
The key observation from the analysis is that the number of resource sharing
arrangements appears to be confined to a narrow range of activities but which have
proved to be successful and could provide the template for arrangements in a broad
range of other areas. The extent to which this is not occurring following the recent media
and other attention on the issue of shared services generally suggests there needs to be
more promotion of the range of resource sharing arrangements which could be pursued
and more encouragement and facilitation to Councils to engage in such arrangements.
It is suggested that this could be a key coordinating role for the LGA in conjunction with
Councils and other organisations such as LGCS.
As there are potential sensitivities and political impacts from pursuing some resource
sharing opportunities it is suggested that a rigorous high level process be followed which
should highlight the key issues and decision making steps required. While there are a
number of approaches which could be used the process outlined in the LGA’s Service
Provision in Local Government Manual could be a useful tool to guide Councils. This
process sets out a 5 step process which has been adapted as follows:
Step 1 – Identification of Resource Sharing Choices
 Assessing options for resource sharing
 What choices for resource sharing are we currently pursuing and why?
Step 2 – Examining Council’s Strategic Management Plans and Employee Relations
Environment
 Examining Strategic and Corporate Plans
 Examining the Employee Relations Environment
 Examining the Organisation and Service Provision Culture
Step 3 – Identifying Current Resource Sharing Choices
 Service Audit
 Internal and external factors
 Possible future choices
Analysis of Responses to a Council Survey – Tony Lawson Consulting – February 2007
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Appendix 1
Review of SA Local Government Joint Service Delivery Opportunities
Step 4 – Establishing or Reviewing Council’s Resource Sharing Policy
 Policy statement
 Guiding principles
 Decision making framework
 Example resource sharing policy
Step 5 – Promoting Council’s Resource Sharing Policy
 Stakeholders
 Identifying promotional strategies
This process needs to be conducted at the highest levels and may need external
assistance and support from the LGA and/or expert consultants. Once this process has
been completed and the political sensitivities and other impacts have been identified and
resolved the next phase of developing business cases and plans may proceed.
The preparation of business cases may be developed in-house if there is the capacity
and experience to do this. In other cases assistance may be required from experienced
external organisations such as LGCS and others.
Recommendations
In order to progress the development of business cases and promotion of increased
participation in shared services arrangements by Councils the report recommends that
the LGA:






conduct a forum involving senior officers of Councils to consider the findings and
recommendations resulting from this research;
at the forum invite nominations for ‘case study’ Councils to participate in further
development of business cases in key priority areas for service collaboration
emerging from the report;
access funding available from the LGFA for the development of business cases
where the potential exists for the LGCS to undertake/co-ordinate collaborative
service arrangements across the sector;
put the outcomes of the survey and recommendations outlined in the report to the
2007 April General Meeting for endorsement;
upon the development of the business cases identified above, assist Councils to
participate in collaborative service areas, deemed viable through the conduct of
the case studies;
collect financial and other information to demonstrate the benefits gained already
from collaboration between all Councils, groups of Councils and through other
mechanisms already in place in the sector along with projected savings resulting
from work undertaken following adoption of the report.
Analysis of Responses to a Council Survey – Tony Lawson Consulting – February 2007
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Appendix 1
Review of SA Local Government Joint Service Delivery Opportunities
Attachment 1
Councils Responding to the Survey
1. Adelaide
2. Alexandrina
3. Barossa
4. Barunga West
5. Burnside
6. Ceduna
7. Charles Sturt
8. Cleve
9. Copper Coast
10. Flinders Ranges
11. Franklin Harbour
12. Grant
13. Holdfast Bay
14. Kangaroo Island
15. Karoonda East Murray
16. Le Hunte
17. Lower Eyre Peninsula
18. Mitcham
19. Mount Gambier
20. Mount Remarkable
21. Murray Bridge
22. Norwood, Payneham and St Peters
23. Orroroo/Carrieton
24. Peterborough
25. Port Lincoln
26. Prospect
27. Robe
28. Salisbury
29. Streaky Bay
30. Tea Tree Gully
31. Tumby Bay
32. Wattle Range
33. West Torrens
34. Whyalla
Analysis of Responses to a Council Survey – Tony Lawson Consulting – February 2007
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Appendix 1
Review of SA Local Government Joint Service Delivery Opportunities
ATTACHMENT 2
Summary of Key Issues Identified from the Analysis
The services most commonly reported as being the subject of joint sharing
arrangements, actively considered for implementation or worthy of future investigation
are consolidated and summarised in the table below. A number of key issues are noted
from the analysis of all the responses received.
Type of service
Waste management
Environmental health
Number Discussion
of times
referred
to
33
 A total of 18 Councils indicated they have
existing waste management resource sharing
arrangements, a further 13 are actively
considering implementation and a further 2
wish to pursue regional waste management
opportunities.
 The major service delivery model for this
service was stated as being the regional
subsidiary model.
The rationale for this
arrangement included economies of scale,
access to specialist services, reducing
duplication of services and increasing the
capacity of smaller Councils.
 A number of regional/rural Councils indicated
their wish to pursue joint management of
landfills and additional recycling and hard waste
services. The increase in waste levies, EPA
requirements for the management of landfills
and the SA Government’s targets to achieve
zero waste, suggest that there should be a
smaller number of larger regional waste
management resource sharing arrangements
designed to achieve greater economies of scale
and improved management of this activity.
23
 There is no surprise that this service area has
received a high response rate as it is well
documented that there is a lack of available
resources to fulfil Council statutory compliance
in this area brought about largely because of
the introduction of the Food Act and the
according of greater responsibility to Councils.
 This service area is of greater concern in
regional/rural Councils where it is more difficult
to attract qualified staff, leading to an increased
number of resource sharing arrangements.
Analysis of Responses to a Council Survey – Tony Lawson Consulting – February 2007
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Appendix 1
Review of SA Local Government Joint Service Delivery Opportunities

Sharing/purchasing of
physical and other
assets
21


Development
assessment/town
planning
20



Back office operations 20
(including payroll,
human resources,
financial management)


The majority of arrangements in this service
area are through the Council to Council
reciprocation model of service delivery. The
rationales for this arrangement included
economies of scale, access to specialist
services, reducing duplication of services and
increasing the capacity of smaller Councils.
The need appears to be greater in the
regional/rural area due to the limited capacity of
Councils to purchase expensive equipment in
their own right and it obviously makes sense to
promote these arrangements to achieve
economies of scale and reduce duplication.
The majority of arrangements are by Council
to Council reciprocation. There are some
regional subsidiary arrangements in place.
Similar
to
environmental
health
the
development assessment area also suffers as a
result of a lack of available resources. The
combination of these 2 issues has resulted in
the raising of the need for the development of
regional cadetship/trainee schemes and relief
staff pools.
The majority of collaborative arrangements in
this service area are via a model of Council to
Council reciprocation, although a suggestion
was made for the development of a regional
subsidiary model approach. The approach to
service delivery in this service area is being
influenced by the move to a more regional
approach to development assessment.
The reasons given for pursuing these
arrangements include economies of scale,
reducing duplication and gaining access to
specialist services and increasing the capacity
of smaller Councils.
Interestingly, a total of 12 responses indicate
that collaborative approaches in this service
area are worthy of further investigation, 7 are
investigating implementation and there was
only 1 response that indicated an actual
resource sharing arrangement which is in
place.
It is suggested that this is a prime service area
for resource sharing given the similarity in
processes between Councils. There may be
some sensitivity around potential job losses but
this would need to be offset against cost
savings through economies of scale, improved
productivity and access to specialist expertise
Analysis of Responses to a Council Survey – Tony Lawson Consulting – February 2007
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Appendix 1
Review of SA Local Government Joint Service Delivery Opportunities
IT services (including
hardware and
software procurement
support, broadband
services, software and
systems development,
specialist IT support
services etc.)
14



Building
11
assessment/inspection



Governance,
compliance and audit
services
8



Economic
development and
tourism
6


Crime prevention
6


Road construction and
6

and reduction in duplication.
A total of 5 Councils reported having resource
sharing arrangements are in place while 7
Councils are investigating such arrangements
or feel that this area is worthy of investigation
for shared service opportunities.
The majority of shared arrangements that are in
place are undertaken via Council to Council
reciprocation and 2 are via private sector
direct arrangements.
Once again the need appears to be greater in
regional/rural areas but there is no reason why
this would not apply as well in the metropolitan
area.
The number of resource sharing arrangements
in this service area is not as extensive as with
environmental
health
and
development
assessment but there are similar issues
regarding a paucity of resources.
Once again the need is greater in the
regional/rural area.
The majority of arrangements are by Council
to Council reciprocation.
The need for collaborative arrangements in this
service area applies equally to the metropolitan
and regional/rural areas and is recognition of
the need for specialist skills, reducing
duplication.
While there is only 1 actual arrangement in
place it is suggested that given the importance
of governance and compliance it is somewhat
surprising there are not more arrangements in
place.
It is also suggested this area lends itself to
resource sharing.
These arrangements apply to regional/rural
areas mainly but also to the metropolitan area
in 1 instance.
These arrangements are based on Council to
Council reciprocation and acquiring specialist
skills, increasing collaboration and reducing
duplication.
Of the 6 responses received 5 are in the metro
area and the majority employ State/Local
collaboration models as a consequence of
State funding provided to this service area.
These arrangements apply mainly to the
metropolitan area but also to the regional/rural
areas in 1 instance.
These
arrangements
apply
mainly
to
Analysis of Responses to a Council Survey – Tony Lawson Consulting – February 2007
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Appendix 1
Review of SA Local Government Joint Service Delivery Opportunities
sealing
STEDS

5


Health and
immunisation
5


After hours contact
service
4


General inspection
services
4


Engineering services
and advice
4


regional/rural areas.
These arrangements are based on Council to
Council reciprocation and acquiring specialist
skills, increasing collaboration and reducing
duplication.
These
arrangements
apply
mainly
to
regional/rural areas.
These arrangements are based on a regional
subsidiary model, economies of scale and
reducing duplication.
These arrangements apply to regional/rural
areas mainly but also to the metropolitan area
in 2 instances.
These arrangements are based on a regional
subsidiary model and acquiring specialist
skills, increasing collaboration and reducing
duplication.
Only 1 response refers to an actual
arrangement while 3 others suggest current
investigation or being worthy of further
investigation.
The model of delivery being used is the LG
Corporate Model through LGCS. Although
only 4 Councils reported participating in this
service there are in fact a total of 31 Councils
and Local Government entities using the after
hours contact service established by the LGCS.
These
arrangements
apply
mainly
to
regional/rural areas.
These arrangements are based on Council to
Council reciprocation and acquiring specialist
skills, increasing collaboration and reducing
duplication.
These
arrangements
apply
mainly
to
regional/rural areas.
These arrangements are based on Council to
Council reciprocation and acquiring specialist
skills, increasing collaboration and reducing
duplication.
Analysis of Responses to a Council Survey – Tony Lawson Consulting – February 2007
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Appendix 1
Review of SA Local Government Joint Service Delivery Opportunities
TABLE 1: Examples of joint service delivery arrangements implemented by Councils
Notes:
1. Examples are shown in descending order of number of types of services being shared.
2. A majority of Councils referred to membership of Regional Associations, PLAIN/Library agreement, Central LG Services eg
Mutual Liability. As a majority of Councils are members of regional associations and participate in PLAIN arrangements and
central LG services these are not described in the table.
3. In addition arrangements involving programs such as HACC are not referred to.
Type of Service
No. of
Councils
Delivery
Model
Environmental
Health
17
Council to
Council
(reciprocation)
Location
Regional/
Rural
(R/R)
Metropolitan (M)
R/R and M
Internal
(I) or
External
(E)
Service
Reasons for
Model and
Benefits
Measurement
Positive
Lessons
Negative
Lessons
I
Economies of
scale (E)
Reducing
duplication of
services (D)
Increased
collaboration
and
increased
capacity of
smaller
Councils
-
M and R/R
E
Economies of
scale (E)
Access to wider
range of skills (S)
Access to
specialist
services (SS).
Reducing
duplication of
services (D)
E,D,SS
Increased
collaboration
Need to monitor
performance
E,SS
Reduction of
waste to
landfill
E, D
E,S,SS,D
E,D
Increased
collaboration
and
increased
capacity of
smaller
Councils
-
(C)
Waste
Management
Development
Assessment
18
13
Regional
Subsidiary
(14)
Private sector
direct (2)
C
R/R
I
Analysis of Responses to a Council Survey – Tony Lawson Consulting – February 2007
DME: 89507
23
Appendix 1
Review of SA Local Government Joint Service Delivery Opportunities
Type of Service
No. of
Councils
Delivery
Model
Location
Regional/
rural (R/R)
Metropolitan (M)
Internal
(I) or
External
(E)
Service
Reasons for
model and
benefits
Measurement
Positive
lessons
Negative
lessons
Building
Assessment
10
C
R/R
I
Economies of
scale (E)
8
C
R/R
I
Regional
Purchasing
Authority
Crime Prevention
6
C
M
I
E,D
E,D
Increased
collaboration
and
increased
capacity of
smaller
Councils
Increased
collaboration
and
increased
capacity of
smaller
Councils
E,D
-
Sharing Physical
Assets
Economies of
scale (E)
Access to wider
range of skills (S)
Access to
specialist
services (SS)
E,S,SS,D
6
State/Local
Collaboration
Metro (5)
E
E,SS,D
Increased
collaboration
-
Economic
Development &
Tourism
IT Services
5
C
R/R (1)
R/R
E
E,SS,D
E,D,
community
response
E
Increased
collaboration
-
5
C (3)
Private sector
direct (2)
R/R
I
E,D,SS
E,D
Increased
collaboration
and
increased
capacity of
-
Analysis of Responses to a Council Survey – Tony Lawson Consulting – February 2007
DME: 89507
24
E,D
-
-
Appendix 1
Review of SA Local Government Joint Service Delivery Opportunities
Type of Service
No. of
Councils
Delivery
Model
Location
Regional/
rural (R/R)
Metropolitan (M)
Internal
(I) or
External
(E)
Service
Reasons for
model and
benefits
Measurement
Positive
lessons
Negative
lessons
Regional Road
Sealing
Youth
Development
3
C
R/R
E
E,D,SS
E
E
4
C
R/R
E
E,S,SS and D
E,SS,D,
community
response
Emergency Risk
Management
Environmental
education
3
C
M
I/E
E,SS
E
3
M
I/E
E,S,SS,D
E, community
response
Community
Passenger
Transport Network
Aged Services/
Supported
Residential
Accommodation
Flood Mitigation
3
C (2)
Private sector
direct (1)
State/Local
Collaboration
Increased
collaboration
and
increased
capacity of
smaller
Councils
Increased
collaboration
Increased
collaboration
Time delays at
peak periods
Potential for cost
shifting by other
governments
R/R
E
E,D,SS
E, community
response
Increased
collaboration
-
2
State/Local
Collaboration
R/R
E
E,S,SS,D
E
E
-
2
M
I/E
E,S,SS,D
E
2
M
E
E,D,SS
E
Increased
collaboration
Community
Service
-
ePermits (Small
Business
Registration
System)
GIS Administration
Regional
Subsidiary
C
3
C
M
I
E,S,SS,D
E,D
Increased
collaboration
-
Analysis of Responses to a Council Survey – Tony Lawson Consulting – February 2007
DME: 89507
25
-
-
Appendix 1
Review of SA Local Government Joint Service Delivery Opportunities
Type of Service
No. of
Councils
Delivery
Model
Location
Regional/
rural (R/R)
Metropolitan (M)
Internal
(I) or
External
(E)
Service
Reasons for
model and
benefits
Measurement
Positive
lessons
Negative
lessons
Cemetery
Management
Business
Enterprise Centre
2
Subsidiary
M
E
E,SS,D
E,D
-
2
State/Local
Collaboration
M
I/E
E,S,SS,D
E,D
Increased
collaboration
Increased
collaboration
Engineering
Advice
Regional Health
Authority
2
C
R/R
I
E,S,SS,D
E,D
-
3
Regional
Subsidiary
M
E
E,S,SS,D
E,D, formal
reporting
Regional Rates
Co-ordination
Regional Grants
Officer
3
C
M
I
E,S,SS,D
E
4
C
M
I
E,D,SS
General Inspection
Services
Arts and
Community
Development
3
C
R/R
I
E,D,SS
Amount of
successful
grants
E,D
Increased
collaboration
Promotes
consistency
in application
of statutory
responsibilitie
s
Increased
collaboration
Increased
collaboration
-
1
C
R/R
E
E,S,SS,D
E,SS,D
Social Planning
Alliance
1
C
M
I/E
E,SS,D
E,D
Increased
collaboration
Increased
collaboration
and
increased
capacity of
smaller
Councils
Increased
collaboration
Analysis of Responses to a Council Survey – Tony Lawson Consulting – February 2007
DME: 89507
26
-
Need to monitor
closely
-
Potential for cost
shifting by other
governments
-
Appendix 1
Review of SA Local Government Joint Service Delivery Opportunities
Type of Service
No. of
Councils
Delivery
Model
Location
Regional/
rural (R/R)
Metropolitan (M)
Internal
(I) or
External
(E)
Service
Reasons for
model and
benefits
Measurement
Positive
lessons
Negative
lessons
Community Hub
Feasibility
Joint Tendering for
Assets and
Services
Regional
Governance
Support
Solar Hot Water
Service Grant
Scheme
After Hours
Contact Service
1
C
M
E
E,SS,D
E,D
-
1
C
R/R
I
E,D
E,D
Increased
collaboration
Increased
collaboration
1
C
M
I
E,SS,D
Increased
collaboration
-
1
Lead Council
M
E
E,SS,D
Increased
awareness of
governance
Reports to
Steering c’tee
Increased
collaboration
-
2
LGA
Corporate
Model
M
E
E,D,S
E,D
Community
service
-
Financial
Management and
Information
Systems
Doctor Housing
Management
1
C
R/R
I
E,SS,D
Compliance,
E
Increased
collaboration
-
1
State/Local
Collaboration
R/R
E
E
Increase in
GP’s
Potential for cost
shifting
Youth Centre
Management
1
State/Local
Collaboration
(1)
R/R
I/E
Community
Service
Nos
attending
Private sector
direct (1)
R/R
E
Community
Service
Nos
attending
Leadership
role in
community
More GP’s
Higher nos of
Indigenous
youth
attending
Nos
attending
Analysis of Responses to a Council Survey – Tony Lawson Consulting – February 2007
DME: 89507
27
-
Potential for cost
shifting
Appendix 1
Review of SA Local Government Joint Service Delivery Opportunities
Type of Service
No. of
Councils
Delivery
Model
Location
Regional/
rural (R/R)
Metropolitan (M)
Internal
(I) or
External
(E)
Service
Reasons for
model and
benefits
Measurement
Positive
lessons
Negative
lessons
Regional Water
Supply
1
State/Local
Collaboration
R/R
I/E
E,SS
E
Potential for cost
shifting
Temporary
Accommodation
1
State/Local
Collaboration
R/R
I/E
E
Contract
Patrol Grading
1
Private sector
direct
R/R
E
E
Contract
Far West Football
League
Management
Regional Aerial
Photography/
Mapping
Regional
Telecommunication
Water Recycling
1
Lead Council
R/R
I/E
Service to
community
1
C
R/R
I
E,SS,D
Increased
participation
in football
E
Leadership
role in
community
Model
scheme –
won awards
Contestability
& mix of
private & LG
expertise
Leadership
role in
community
E
1
C
R/R
E
E,SS,D
E
Community
service
Cost to Council
1
C
M
E
E,D
E
-
Graffiti Database
1
Lead Council
M
I
E,SS,D
E
Regional Home
Maintenance
Project
Caravan Park
Management
1
C
M
I/E
E
Community
satisfaction
Community
service
Community
service
Community
service
1
Private sector
direct
R/R
I/E
E
Contract
Community
service
-
Analysis of Responses to a Council Survey – Tony Lawson Consulting – February 2007
DME: 89507
28
Potential for cost
shifting
-
More being
expected of
Council
-
-
Appendix 1
Review of SA Local Government Joint Service Delivery Opportunities
Type of Service
No. of
Councils
Delivery
Model
Location
Regional/
rural (R/R)
Metropolitan (M)
Internal
(I) or
External
(E)
Service
Reasons for
model and
benefits
Measurement
Positive
lessons
Negative
lessons
Temp Labour Hire
1
C
M
E
E
Contract
nil
Legal Services
1
C
M
E
E
Contract
Purchase of
Electricity
1
LG Groups
and
Committees
M
E
E
Contract
Resource
sharing very
effective
Resource
sharing very
effective
Information
and expertise
sharing
Analysis of Responses to a Council Survey – Tony Lawson Consulting – February 2007
DME: 89507
29
nil
Takes longer to
resolve issues
due to nos. of
people on
committees
Appendix 1
Review of SA Local Government Joint Service Delivery Opportunities
TABLE 2: Examples of joint service delivery arrangements Councils are actively considering for implementation
Description of Service
No. of Councils
13
Internal (I) or
External (E) Service
I
Service Delivery
Model
Regional Subsidiary
Regional/Rural (R/R)
Metropolitan (M)
R/R
Waste Management
(including Management
of Landfill, Hard Refuse
Service and Recycling)
Financial Management
7
I
Council to Council
(reciprocation)(C)
R/R
Economies of
scale (E)
Access to
specialist services
(SS).
Reducing
duplication of
services (D)
E,SS,D
Governance/Compliance
Function
Plant & Equipment
Acquisition
Health & Immunisation
Service
Regional Development
Assessment
Engineering Services
Asset Management
System
Library IT System
Environmental Health
function
Road Construction
Street Sweeping
After Hours Emergency
Call System
Stormwater
Management Plans
5
I
C
M
E,SS,D
5
I
C
R/R
E,D
2
E
C
M
E,SS,D
4
I
Regional Subsidiary
M
E,SS,D
2
2
I
I
C
C
R/R
R/R
E,SS,D
E,SS,D
2
2
I
I/E
C
C
R/R
R./R
E,SS,D
E,SS,D
2
2
1
I
I
I/E
R/R
M
R/R
E,SS,D
E,D
E,SS,D
1
I
C
Private sector direct
LGA Corporate
Model
Subsidiary
M
E,SS,D
Analysis of Responses to a Council Survey – Tony Lawson Consulting – February 2007
DME: 89507
30
Benefits
Appendix 1
Review of SA Local Government Joint Service Delivery Opportunities
Description of Service
No. of Councils
1
Internal (I) or
External (E) Service
E
Service Delivery
Model
C
Regional/Rural (R/R)
Metropolitan (M)
M
Regional Street Lighting
Project
Disaster Recovery
System (IT)
Stationery & Printing
Services
Joint Maintenance &
Contracting
Garden Service for
Elderly Residents
Regional Inspectorial
Service
Human Resource
Function
Shared IT Support
GIS Services
Regional Tourism
Regional Audit
Community
Development
STEDS
Relief Staff Pool
EPLGA - investigating
shared services
arrangements re Plant
Sharing, Development
Assessment, Regional
Planning (Coastal ,
Sport & Recreation)
1
I
Private sector direct
M
Regional
collaboration
Environmental
benefits
Risk Management
1
I
C
M
E,SS,D
1
E
C
M
E,SS,D
1
E
C
M
E,D
2
I
Lead Council
M
E,SS,D
2
I
C
M
E,SS,D
4
1
1
1
1
I
I
E
I
I
C
C
C
C
C
M
M
R/R
R/R
R/R
E,SS,D
E,SS,D
E,SS,D
E,SS,D
E,SS,D
1
1
1
I/E
I
I/E
Regional Subsidiary
C
Regional subsidiary
R/R
R/R
R/R
E,D
E,SS,D
E,SS,D
Achieving regional
strategic outcomes
Analysis of Responses to a Council Survey – Tony Lawson Consulting – February 2007
DME: 89507
31
Benefits
Appendix 1
Review of SA Local Government Joint Service Delivery Opportunities
Description of Service
No. of Councils
Service Delivery
Model
Private sector direct
Regional/Rural (R/R)
Metropolitan (M)
R/R
Benefits
1
Internal (I) or
External (E) Service
I
Regional Aerial
Mapping
Community Renewal
Project
Sport and Recreation
Planning
1
E
C
M
1
I
C
M
1
I/E
C
M
Building social
capital
E,D Standardised
approach to leases
etc
E,SS, D
Infrastructure and
Natural Asset Services
Electricity Contracts for
Green Power
1
E
Cooperative contract
M
E,SS,D
Environmental
benefits
TABLE 3: Examples of resource sharing opportunities worthy of future investigation
Description of
Service
Back Office Services
(including Human
Resources, Financial &
Payroll)
STEDS
Environmental Health
Vehicle/Plant
Leasing/Purchasing
Regional Development
Assessment/Town
Planning
After Hours
Compliance Service
Regional Trainee
Cadetship Scheme
No. of Councils
Service Delivery
Model
C and/or private sector
direct
Regional/Rural (R/R)
Metropolitan (M)
M & R/R
Benefits
12
Internal (I) or
External (E) Service
I
4
4
3
E
I/E
I
Regional subsidiary
C
Regional subsidiary
R/R
R/R
R/R
E,SS,D
E,SS,D
E,D
3
I
C
R/R
E,SS,D
2
I/E
LGA Corporate
Model
M
E,SS,D
2
I
C
R/R
E,SS,D
Analysis of Responses to a Council Survey – Tony Lawson Consulting – February 2007
DME: 89507
32
E,SS,D improving
productivity
Appendix 1
Review of SA Local Government Joint Service Delivery Opportunities
Description of
Service
Media Monitoring
Library Management
Systems
Regional Waste
Management
Delivery of Capital
Works
General Inspection
Services
Collection of Other
Government Levies,
Fees
No. of Councils
Service Delivery
Model
?
?
Regional/Rural (R/R)
Metropolitan (M)
M
M
Benefits
1
1
Internal (I) or
External (E) Service
I
I
2
E
Private sector direct
R/R
E,D
1
I
C
M
E,SS,D
1
I/E
C
R/R
E,SS,D
1
I/E
Lead Council
R/R
Asset Management
Building Inspection
Health & Immunisation
1
1
1
I
I
I/E
R/R
R/R
R/R
Town Water Supplies
IT Services
Regional Audit
1
2
1
E
I
I
Lead Council
Private sector direct
State/Local
Collaboration
C
C
C
Provide more
services to
geographically
diverse community
E,SS,D
E,SS,D
E,SS,D
R/R
R/R
R/R
E,SS,D
E,SS,D
E,SS,D
Analysis of Responses to a Council Survey – Tony Lawson Consulting – February 2007
DME: 89507
33
E,SS,D
E,SS,D
Appendix 1
Review of SA Local Government Joint Service Delivery Opportunities
Review Of South Australian Local Government Joint Service Delivery Opportunities - Circular 42.6
To
Chief Executive Officer
Contact
Bill Furse
Email: bill.furse@lga.sa.gov.au
Date
Monday, 16th October 2006
Response
Required
Yes
Respond By
Wednesday, 8th November 2006
Summary
The LGA is conducting a survey to identify current examples of collaborative service delivery and future opportunities for resource sharing/joint
service delivery activities and undertakings in Local Government in South Australia.
The Independent Inquiry into the Financial Sustainability of Local Government recommended that the LGA investigate with Councils opportunities to enhance current
collaborative or shared services delivery in an effort to create better efficiencies and savings.
The issue of shared services was addressed in the LGA's Information Paper 7: Service Delivery Framework including the Role of Shared Services prepared as part of the LGA's
Financial Sustainability Program. The paper identifies a range of strategies for the delivery of services by Councils through shared or collaborative arrangements.
It is recognised that there are already a number of areas where Councils are collaborating in providing services to the community and sharing resources. It appears however that
there has been no comprehensive sector-wide research undertaken to capture the examples of what is currently occurring, the nature of savings being achieved and opportunities
to enhance collaborative service delivery.
The LGA now wishes to consult with Councils` to identify current collaborative service delivery areas and future opportunities for resource sharing/joint service delivery
activities and undertakings in Local Government in South Australia. The survey is being undertaken jointly by the LGA in association with Local Government Corporate Services
(LGCS) and will build on the work which has already been undertaken.
The project will involve a survey of Councils to identify:



current resource sharing and collaborative practices in service areas by SA Councils;
resource sharing opportunities not currently in practice in SA but worthy of future investigation;
options for implementation of various resource sharing measures relative to the future opportunities identified.
Council's detailed budget listing may provide a useful reference when completing the questionnaire.
The data and information gathered from the survey will form the basis of a detailed report to the LGA. The project will be completed in November 2006.
The survey questionnaire seeking identification of current resource sharing practices and future opportunities can be accessed by clicking on the link below.
Joint Service Delivery Council Survey 2006
(79 kb)
If you require clarification on any issues or assistance in completing the survey please contact Tony Lawson on 0417 895 180 or tlawcons@bigpond.net.au.
It is requested that the questionnaire be completed and emailed to bill.furse@lga.sa.gov.au by Wednesday 8 November 2006.
Your assistance in completing the questionnaire is appreciated.
Analysis of responses to a Council Survey – Tony Lawson Consulting – December 2006
- 34 -
Appendix 1
Review of SA Local Government Joint Service Delivery Opportunities
REVIEW OF SOUTH AUSTRALIAN LOCAL GOVERNMENT JOINT SERVICE DELIVERY OPPORTUNITIES
COUNCIL SURVEY
INTRODUCTION
The Independent Inquiry into the Financial Sustainability of Local Government recommended that the LGA investigate with Councils
opportunities to enhance current collaborative or shared services delivery in an effort to create greater efficiencies and savings.
The issue of shared services was addressed in the LGA’s Information Paper 7: Service Delivery Framework including the Role of
Shared Services prepared as part of the LGA’s Financial Sustainability Program. The paper identifies a range of strategies for the
delivery of services by Councils through shared or collaborative arrangements.
There has been recent debate in the media and within the Parliament suggesting that there is tremendous scope for Councils to
collaborate further in service delivery. There is clearly interest within Councils themselves to find better ways of gaining efficiencies
through enhancing collaborative activities.
It is recognized that there are already a number of areas where Councils are collaborating in providing services to the community and
sharing resources. It appears however that there has been no comprehensive sector-wide research undertaken to capture the
examples of what is currently occurring, the nature of savings being achieved and opportunities to enhance collaborative service
delivery.
This survey has been prepared to capture information regarding the number and nature of services that Councils are currently
collaborating on and to identify the structural arrangements for the joint delivery of services.
REVIEW OF SA LOCAL GOVERNMENT JOINT SERVICE DELIVERY OPPORTUNITIES - COUNCIL SURVEY
DME 89507
- 35 -
Appendix 1
Review of SA Local Government Joint Service Delivery Opportunities
It is proposed that the information gained from this survey will be reported back to Councils along with recommendations for areas
where opportunities might exist to enhance collaborative activities.
The LGA State Executive Committee at its September 2006 meeting resolved for the Secretariat to conduct research into the current
and future opportunities for shared service delivery and so the conduct of this project is timely.
This project is being undertaken by the LGA in consultation with Local Government Corporate Services (LGCS) which has resources
available to develop business cases for exploring areas for further collaboration.
It is suggested that Councils review Information Paper 7 prior to completing the survey to gain an appreciation of the scope of joint
service delivery, definitions and identified models.
If you require clarification on any issues or assistance in completing the survey please contact Tony Lawson on 0417 895 180 or
tlawcons@bigpond.net.au.
Your assistance in completing the survey is appreciated.
Please return the questionnaire to bill.furse@lga.sa.gov.au by 8 November 2006
REVIEW OF SA LOCAL GOVERNMENT JOINT SERVICE DELIVERY OPPORTUNITIES - COUNCIL SURVEY
DME 89507
- 36 -
JOINT SERVICE DELIVERY OPPORTUNITIES SURVEY
Q1. What joint service delivery arrangements has your Council implemented?
In answering this question please give consideration to the delivery models used and the functions covered in the arrangement (eg waste, IT,
human resources, payroll etc). Reference to Information Paper 7 on the role of Shared Services which contains an overview of resource
sharing models and approaches may assist in answering this question eg Subsidiary/Regional Subsidiary, Regional Associations of Councils,
Council to Council, Lead Councils, Private Sector Direct, Private Sector Management etc. Please indicate whether the service is ‘internal’ i.e. a
service to Council, or ‘external’ i.e. a service to the community.
Reasons for selecting a particular model may include: optimising people and their skills, better utilization of assets, time and other resources,
functions are concentrated either geographically or through a form of communication link, maximising the use of an investment etc.
If your Council utilises a joint service delivery model that is different to those described in Information Paper 7 please provide a detailed
description of the approach. Please add additional rows to the table if needed.
Description of Shared
Service
A
B
C
D
E
Date of
Commencement
Internal
Service/External
Service
Model of Shared
Service Delivery Used
Functions Covered by
Shared Delivery
Arrangements
Reasons for Selecting
this Model
Appendix 1
Review of SA Local Government Joint Service Delivery Opportunities
Q1: continued
Estimated Annual
Cost Savings to
Council
Benefits to
Communities and
Councils
How are
Achievements of the
Shared Service
Delivery Model
Measured?
How is Accountability
to Council and
Community
Measured?
A
B
C
D
E
REVIEW OF SA LOCAL GOVERNMENT JOINT SERVICE DELIVERY OPPORTUNITIES - COUNCIL SURVEY
DME 89507
- 38 -
Positive Lessons
Learned by Council
from Experiences to
Date
Negative Lessons
Learned by Council
from Experiences to
Date
Appendix 1
Review of SA Local Government Joint Service Delivery Opportunities
Q2. What joint service delivery arrangements is your Council actively considering, or would like to implement, but has not yet done
so.
In answering this question please refer to Information Paper 7 on the role of Shared Services which contains an overview of resource sharing
models and approaches.
Please add additional rows to the table if needed.
Description of
Potential Shared
Service
Internal
Service/External
Service
Model of Shared
Service Delivery to be
Used
Functions to be
Covered by Potential
Shared Delivery
Arrangement
A
B
C
D
E
REVIEW OF SA LOCAL GOVERNMENT JOINT SERVICE DELIVERY OPPORTUNITIES - COUNCIL SURVEY
DME 89507
- 39 -
Estimated Annual
Cost savings to
Council
(if known)
Proposed Benefits to
Communities and
Councils.
Appendix 1
Review of SA Local Government Joint Service Delivery Opportunities
Q3. What other resource sharing opportunities would be worthy of future investigation?
Please add additional rows to the table if needed.
Description of Potential
Shared Service
Internal Service/External
Service
Potential Model for Shared
Service Delivery
Functions to be Covered
by Potential Shared
Delivery Arrangement
A
B
C
D
E
Q4. Comments
Thank you for completing the questionnaire.
Please return the questionnaire to bill.furse@lga.sa.gov.au by 8 November 2006
REVIEW OF SA LOCAL GOVERNMENT JOINT SERVICE DELIVERY OPPORTUNITIES - COUNCIL SURVEY
DME 89507
- 40 -
Proposed Benefits to
Communities and
Councils.
Shares Services in SA Local Government
Local Government Association of South Australia - Report
APPENDIX 2
Implementation Framework for Shared Services
in Local Government
Introduction
Councils constantly strive to improve the efficiency of their service delivery. Their finances face
pressure as a result of increased community demands for services, the need to maintain
assets/infrastructure, skills shortages, increased legislative/compliance responsibilities etc.
Councils recognise that they must operate in a financially sustainable manner without
compromising the quality of services delivered. It is recognised that co-operative working
arrangements can yield significant efficiencies for all participants.
Among its various findings, the Independent Inquiry into the Financial Sustainability of Local
Government recognised that there are many forms of co-operation/integration currently
operating between Councils but challenged Councils to do more. Specifically the Inquiry report
recommended:
“11.2 (1) That, in canvassing alternative methods of delivery, councils consider further
resource-sharing initiatives, especially involving the smaller councils, ranging from
working together more effectively to more formalised regional groups, area integration
and whole-of-sector initiatives.”
In order to promote greater efficiencies and savings through increased co-operation between
Councils the LGA released Information Paper 7: Service Delivery Framework including the Role
of Shared Services, which identifies a range of strategies for the delivery of services by Councils
through shared or collaborative arrangements. This paper sets out various models which in
some cases go beyond the currently recognised scope of shared service arrangements and
which might be explored by Councils wishing to pursue creative approaches to securing
efficiencies through greater application of co-operation between Councils.
In November 2006 the LGA, in consultation with Local Government Corporate Services (LGCS),
commissioned a comprehensive sector-wide survey to capture examples of what is currently
occurring between Councils, the nature of savings being achieved and opportunities to enhance
collaborative service delivery. The survey also gathered information regarding the number and
nature of services that Councils are currently collaborating on and the structural arrangements
for the joint delivery of services. The survey report “Review of South Australian Local
Government Joint Service Delivery Opportunities” (available from the LGA’s web site at
www.lga.sa.gov.au/goto/fsp) was tabled at the LGA’s April 2007 General Meeting and its
findings and recommendations noted.
The report presented to the April 2007 General Meeting recognised a key coordinating role for
the LGA in conjunction with Councils and other organisations such as LGCS and suggested that
a rigorous high level process be followed which should highlight the key issues and decision
making steps required. The report’s recommendations included that the LGA:
 conduct a forum involving senior officers of Councils to consider the report’s findings
and recommendations resulting from this research and identify priority issues for
progress through business case analysis and Councils wishing to participate in ‘case
study’ studies;
 access funding from the $2 million available from the LGFA for the development of
business cases where the potential exists for the LGCS to undertake/co-ordinate
collaborative service arrangements across the sector;
DME 89507
- 41 -
Shared Services in SA Local Government
Local Government Association of South Australia - Report


upon the development of the business cases identified above, assist Councils to
participate in collaborative service areas, deemed viable through the conduct of the
case studies; and,
collect financial and other information to demonstrate the benefits gained already
from collaboration between all Councils, groups of Councils and through other
mechanisms already in place in the sector along with projected savings resulting from
work undertaken following adoption of the report.
On 6 June the LGA, in conjunction with LGCS and LGMA, held a Shared Services Forum which
provided the opportunity for Council representatives to discuss priorities and implementation
issues for the range of opportunities across the sector that had been identified through the
earlier study.
The information gathered through the Forum has been distilled into the attached
“Implementation Framework for Shared Services in Local Government” which sets out a
program for examination and implementation of the various shared service opportunities
identified. The purpose of the Framework is to provide a structured approach to moving forward
in the implementation of Shared Service Delivery in Local Government.
The Framework recognises that not all opportunities will lead to sector-wide implementation and
that some may be best delivered by groups of Councils working collaboratively under some form
of operating agreement or arrangement.
It is proposed to establish a reference group comprising representatives of LGA, LGCS, LGMA
and Councils to provide advice and guidance throughout the implementation of the Framework.
The program of work stemming from the Framework recognises that LGCS has established itself
as a key player in procurement activities in Local Government. However there are several
service areas that may not be the best fit for LGCS and assessments will need to be made to
identify the appropriate means for implementing these. It is proposed that in the first instance
the LGA will work with at least five Councils on a “pilot case study” basis to undertake business
case analyses for each service area identified. Council involvement will be encouraged so as to
provide appropriate representation in terms of location, size, level of resources etc. Councils will
also be encouraged to participate in a “shared services network” to share information about their
current co-operative arrangements and provide a vehicle for bringing together Councils wishing
to establish new collaborative ventures. Where appropriate, LGCS will be closely involved in the
pilot case studies and subsequent implementation.
It is proposed that the Framework be enhanced, overtime, to provide implementation timeframes
for each service area and include information on the current cost of services, target savings from
collaboration and indicators of successful implementation.
The inclusion of cost information will require further work to develop methodologies for cost
estimates as some data is not currently available or not reliable enough for the purposes of
setting targets.
The Framework is structured in two parts.
Part 1: This part addresses the processes for developing the program as a whole.
Part 2: This part details actions over the next, say 5 years for each identified service area and
provides a short description of the activities proposed to explore the area as a pilot for a future
shared service.
Resources will be redirected under the Financial Sustainability Program along with a
submission for additional funding from the LGR&DS to support this work over the
program period. Financial resources will also be secured from the $2 million (to be
expended over a period of time) available via the LGFA to consider shared services
opportunities where it is considered that ultimately the LGCS could manage the service.
The Implementation Framework will operate within the Strengthening Local Government
Program and under the guidance of the LGA’s Financial Sustainability Advisory
Committee.
DME 89507
- 42 -
Shares Services in SA Local Government
Local Government Association of South Australia - Report
Implementation Framework for Shared Services in Local Government
Part 1:
Activity
Resourcing
Development of the Framework
Recommended Actions
 Assign Project Officer to project
Responsibility
LGA
Resources
Project Officer
Timeframe
 Immediate

Secure R&DS funding
LGA
Project Officer

Project Direction


LGA/LGCS
LGA
Project Officer
Project Officer
 Ongoing
Immediate then ongoing
Project Guidance

Secure LGFA funding
Establish program under the
oversight of the LGA’s Financial
Sustainability Advisory Committee
Establish Reference Group
comprising representatives of
LGA, LGCS, LGMA and Councils
LGA/Project Officer
Project Officer

Immediate
ongoing

Prioritise service opportunities
FSAC

Feb 2008

Call for Council expressions of
interest for case studies
LGA
Reference
Group/Project Officer
Project Officer

Nov 2007

Establish Shared Services
Network among Councils
Establish methodology for
estimating cost of current service
provision
LGA
Project Officer

Dec 2007
FSAC
Reference
Group/Project Officer

Feb 2008
Establish methodology for
estimating savings from
collaborative service provision
Develop indicators for successful
implementation
FSAC
Reference
Group/Project Officer

July 2008
FSAC
Reference
Group/Project Officer

July 2008
Council Engagement
Financial Estimates


Evaluation

DME 89507
- 43 -
September 2007
R&DS call
then
Shared Services in SA Local Government
Local Government Association of South Australia - Report
Part 2:
Service Areas for Shared Service Implementation
Existing LGCS Contracts – currently successfully accessed by many Councils
Service







Recommended Actions
After Hours Call
Service (RAA)
Security Services
(RAA)
Corporate Uniforms &
Workwear
Microsoft Agreement
(Commander)
Fleet acquisition &
disposal (Carfleet)
Salary Packaging
(EPAC)
Hazardous Product
safety Management
(Chem Alert)

Increase awareness and
communicate benefits
Responsibility
LGA/LGCS
DME 89507
- 44 -
Resources
Timeframe
ongoing
Financial
Sustainability
Enquiry
Reference
Current LG
Expenditure
Cost
Saving
Target
Shared Services in SA Local Government
Local Government Association of South Australia - Report
SERVICE AREA:
INFRASTRUCTURE OPERATIONS
Service
Recommended Actions
Plant & Equipment
(“Kennards for Councils”) –
 purchase
 utilisation


Buildings/Pools
 maintenance






Infrastructure services
 Design
 Policy development
 Contract
management
 Service delivery – eg
road
construction/sealing,
footpath construction
 Engineering services
& advice
 Street sweeping




Responsibility
Resources
Timeframe
Engage Pilot Councils
Establish and Assess
Business Case
Determine viability
If appropriate, establish a
“roll out program”
LGA
TBD
Engage Pilot Councils
Establish and Assess
Business Case
Determine viability
If appropriate, establish a
“roll out program”
LGA
Engage Pilot Councils
Establish and Assess
Business Case
Determine viability
If appropriate, establish a
“roll out program”
LGA
DME 89507
- 45 -
Current LG
Expenditure
Cost
Saving
Target
TBD
Financial
Sustainability
Enquiry
Reference
11.2 (1)
TBD
TBD
TBD
TBD
11.2 (1)
TBD
TBD
TBD
TBD
11.2 (1)
TBD
TBD
Shared Services in SA Local Government
Local Government Association of South Australia - Report
SERVICE AREA:
PROFESSIONAL SERVICES
Service
Recommended Actions
Responsibility
Resources
Timeframe
Professional Services
 Urban Planners
 Designers/architects
 Engineers
 Financial Services
 Auditors
 Legal Services
 IT Services
 Marketing/PR
 Project Management


Engage Pilot Councils
Establish and Assess
Business Case
Determine viability
If appropriate, establish a
“roll out program”
LGA
TBD
Development Assessment &
Planning
 Policy/PAR’s/Section
30 Reviews
 Assessment
 Administration
 Compliance
 Community interface
(customer service
etc)


Engage Pilot Councils
Establish and Assess
Business Case
Determine viability
If appropriate, establish a
“roll out program”
LGA
Building Inspections and
Assessment
 Compliance
 Assessment
 Professional advice


Engage Pilot Councils
Establish and Assess
Business Case
Determine viability
If appropriate, establish a
“roll out program”
LGCS






DME 89507
- 46 -
Current LG
Expenditure
Cost
Saving
Target
TBD
Financial
Sustainability
Enquiry
Reference
11.2 (1)
TBD
TBD
TBD
TBD
11.2 (1)
TBD
TBD
TBD
TBD
11.2 (1)
TBD
TBD
Shared Services in SA Local Government
Local Government Association of South Australia - Report
SERVICE AREA:
FINANCIAL
Service
Rates




Collection
Modelling
Notices
Advertising
Recommended Actions
Responsibility
Resources
Timeframe


Engage Pilot Councils
Establish and Assess
Business Case
Determine viability
If appropriate, establish a
“roll out program”
LGA
TBD
Engage Pilot Councils
Establish and Assess
Business Case
Determine viability
If appropriate, establish a
“roll out program”
LGA
Engage Pilot Councils
Establish and Assess
Business Case
Determine viability
If appropriate, establish a
“roll out program”
LGA


Payroll
 administration
 processing


Accounting & eProcurement
 Accounts receivable
 Accounts payable
 General ledger
 Financial reporting






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Current
Local
Government
Expenditure
TBD
Cost
Saving
Target
TBD
Financial
Sustainability
Enquiry
Reference
11.2 (1)
TBD
TBD
11.2 (1)
TBD
TBD
TBD
TBD
14.3 (2)
11.2 (1)
TBD
TBD
TBD
Shared Services in SA Local Government
Local Government Association of South Australia - Report
SERVICE AREA:
ICT STREAM
Service
Recommended Actions
IT




Support/help desk
services
Infrastructure –
servers, etc
Software
Joint purchasing
arrangements –
equipment
(computers etc)
Disaster Recovery








Library
 Service delivery
 Management system




Responsibility
Resources
Timeframe
Engage Pilot Councils
Establish and Assess
Business Case
Determine viability
If appropriate, establish a
“roll out program”
LGA
TBD
TBD
Engage Pilot Councils
Establish and Assess
Business Case
Determine viability
If appropriate, establish a
“roll out program”
LGA
TBD
Engage Pilot Council
Establish and Assess
Business Case
Determine viability
If appropriate, establish a
“roll out program”
LGA
TBD
DME 89507
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Financial
Sustainability
Enquiry
Reference
14.3 (2)
11.2 (1)
Current LG
Expenditure
Cost
Saving
Target
TBD
TBD
TBD
11.2 (1)
TBD
TBD
TBD
11.2 (1)
TBD
TBD
Shares Services in SA Local Government
Local Government Association of South Australia - Report
SERVICE AREA:
HUMAN RESOURCES
Service

Recruitment
o Advertising
o Short listing
o initial
interviews
o testing
o contract
negotiations
o letters of offer
 Training
o Course
delivery
o Course
providers
and
information
o Brokerage
 Workforce planning
o Data
gathering
o Data analysis
o Plan
development
 Employee relations
o Award
interpretation
o Classification
review
o EB
negotiations
Industrial advice
/representation
Traineeship/cadetship
Recommended Actions





Responsibility
Resources
Timeframe
Engage Pilot Councils
Establish and Assess
Business Case
Determine viability
If appropriate, establish a
“roll out program”
LGA
TBD
Engage Pilot Councils
LGA
TBD
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Current LG
Expenditure
Cost
Saving
Target
TBD
Financial
Sustainability
Enquiry
Reference
11.2 (1)
TBD
TBD
TBD
11.2 (1)
TBD
TBD
Shared Services in SA Local Government
Local Government Association of South Australia - Report

program
 Administration
 Service delivery
SERVICE AREA:
Establish and Assess
Business Case
 Determine viability
If appropriate, establish a “roll
out program
ENVIRONMENTAL SERVICES
Service
Recommended Actions
Responsibility
Resources Timeframe
Environmental Health
 Inspectorial services
(ie food inspections
etc)
 Records
management
 Professional advice
 Community education


Engage Pilot Councils
Establish and Assess
Business Case
Determine viability
If appropriate, establish a
“roll out program”
LGA
TBD
Immunisation
 Data entry/records
management
 Service provision


Engage Pilot Councils
Establish and Assess
Business Case
Determine viability
If appropriate, establish a
“roll out program”
LGA
Community Waste Water
 Licensing issues and
compliance
 Monitoring
 Water reuse and
recycling


Engage Pilot Councils
Establish & Assess
Business Case
Determine viability
If appropriate, establish a
“roll out program”
LGA






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Current
Local
Government
Expenditure
TBD
Cost
Saving
Target
TBD
Financial
Sustainability
Enquiry
Reference
11.2 (1)
TBD
TBD
11.2 (1)
TBD
TBD
TBD
TBD
11.2 (1)
TBD
TBD
TBD
Shared Services in SA Local Government
Local Government Association of South Australia - Report
SERVICE AREA:
WASTE MANAGEMENT
Service
Recommended Actions
Responsibility
Resources
Timeframe
Waste Management
 Kerbside Collection
o Recycling
o Household
o Green waste
 Disposal
o Recycling
 Landfill
 Transfer stations
 Hard waste
 Industrial/commercial
waste
Identify ‘as-is’ model and
propose the ‘to-be’ model and
develop the ‘road map’ for
sector wide waste management
standard.
LGA
TBD
TBD




Engage Pilot Councils
Establish & Assess
Business Case
Determine viability
If appropriate, establish
a “roll out program
Improve data collection and
reporting
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Financial
Sustainability
Enquiry
Reference
11.2 (1)
Current LG
Expenditure
Cost
Saving
Target
TBD
TBD
Shared Services in SA Local Government
Local Government Association of South Australia - Report
SERVICE AREA:
CORPORATE AND COMMUNITY SERVICES
Service
Recommended Actions
Responsibility
Resources
Timeframe
Governance
 Compliance
 Shared resources


Engage Pilot Councils
Establish and Assess
Business Case
Determine viability
If appropriate, establish a
“roll out program
LGA
TBD
HACC Services & other
State Government Contracts
 Contract
management
 Service delivery


Engage Pilot Councils
Establish and Assess
Business Case
Determine viability
If appropriate, establish a
“roll out program
LGA
Community Services
 service delivery eg
o Community
transport
o Youth services


Engage Pilot Councils
Establish & Assess
Business Case
Determine viability
If appropriate, establish a
“roll out program”
LGA






DME 89507
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Current
Local
Government
Expenditure
TBD
Cost
Saving
Target
TBD
Financial
Sustainability
Enquiry
Reference
11.2 (1)
TBD
TBD
11.2 (1)
TBD
TBD
TBD
TBD
11.2 (1)
TBD
TBD
TBD
Shares Services in SA Local Government
Local Government Association of South Australia - Report
LOCAL GOVERNMENT ASSOCIATION
REVIEW OF LGA SHARED SERVICES
PILOT PROJECTS
Prepared by
Janet Binder
Janet Binder Consulting Pty Ltd
Phone: 08 8388 9747
Fax: 08 8388 9755
E-mail binder@senet.com.au
May 2012
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Contents
Introduction
............................................................................... 2
Methodology
............................................................................... 3
Findings
.............................................................................
3
Conclusion
.............................................................................
12
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1
Introduction
The Independent Inquiry into the Financial Sustainability of Local Government in October
2005 recommended “that in canvassing alternative methods of delivery, Councils consider
further resource-sharing initiatives, especially involving the smaller Councils, ranging from
working together more effectively to more formalised regional groups, area integration and
whole-of-sector initiatives.”
In 2009 the Local Government Association of South Australia (LGA) working in partnership
with participating Councils established a program (Working Together for Stronger
Communities) to facilitate pilot projects to:
 explore and identify opportunities for collaborative resource sharing
 examine the feasibility, capacity and options available to deliver the shared
services/s outcomes
 engage the key stakeholders in the required decision making processes; and
 where relevant jointly manage the implementation of the agreed service delivery
changes.
The following six pilot projects were established under the program:
1. Eyre Peninsula Local Government Association - Investigation of Better Local
Government Service Delivery for the Region
2. The Far North Councils – Development of a Shared Services Model – A Sustainable
Future for Local Government
3. Adjoining SE Coastal Councils (Robe and Kingston) – Joint Delivery of Engineering
Services
4. South East Local Government Association - Common Policy and Specification
documentation for Councils procurement
5. Fleurieu Councils – Governance Structures to Formalise Regional Cooperation
6. Eastern Regional Alliance – Sharing General Inspectorial and Building Inspection
Services.
The LGA provided initial support to Local Government Regional Associations and
participating Councils by way of consultants who assisted Councils in scoping projects.
The LGA now wishes to undertake a review of these projects to determine the current status
and success of the projects including lessons learned.
The LGA engaged Janet Binder, from Janet Binder Consulting Pty Ltd to undertake the
review.
Janet Binder would like to acknowledge the contribution of Chief Executive Officers of
shared service pilot project participating Councils and other stakeholders. Their willingness
to share their thoughts and experiences is greatly appreciated.
2
Methodology
The review methodology involved:
 reviewing documentation on each of the projects provided by the LGA

conducting telephone discussions with participating Councils Chief Executive Officers
(CEO’s) and the Chief Executive Officers of relevant Local Government Regional
Associations to seek their views regarding the projects
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
analysing the information gathered from documentation and telephone discussions

identifying key issues and findings

providing a report including review findings.
3
Findings
3.1
Eyre Peninsula Local Government Association - Investigation of Better Local
Government Service Delivery for the Region
The project scope, developed by Mark Booth from BRM Holdich, for this shared services
project identified three areas as opportunities for shared services.



Governance
Human resources (HR) including regional workforce and succession planning,
regional education and training plan and programs, OHS and risk management
services, standardisation of HR policies, systems, and procedures, regional
development for the delivery of human resource services
Waste management
After considering these opportunities Councils voted to commence the next stage of
collaboration with the development and implementation of standardised HR policies,
systems and procedures.
This has been completed and the templates, policies and procedures have been distributed
to Councils. Seven Councils participated in this project.
In addition ten Councils are undertaking a separate project regarding a collaborative
approach to implementation of OH&S One System. This is continuing with a study currently
being conducted by Sustainable Risk.
With regard to the HR pilot project above, four of the participating Councils and the
Executive Officer of the EPLGA provided feedback.
3.1.1
Project Status
The development of HR templates and policies has been completed and the information
distributed to Councils. Two of the four Council CEO’s that provided feedback indicated they
didn’t know about the HR templates and policies. Both CEO’s had not been involved and
had little or no knowledge of the project. One was relatively new to the area and the other
was acting in the role. One of the other CEO’s said his Council had used one of the model
templates and the other CEO advised that his Council had HR resources and as such didn’t
really benefit from the project. Evidently this Council supported the project from an overall
regional perspective.
With regard to the OH&S One System project as reported above this project is continuing
with a study currently being undertaken.
3.1.2 Benefits and Challenges
When asked to identify any benefits and challenges associated with the project, no real
benefits were identified. Challenges or pitfalls identified were:
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
getting common agreement on the outcome up front; it needs to be achievable. In
the case of this project it seems that Councils had different HR needs and the project
became diluted overtime;

available time to dedicate to the project; CEO’s get side tracked with other issues.
This has a significant impact on project progress and completion timeframes;

the need for real commitment from all the CEO’s involved; the need for buy in both at
the CEO and the Senior Management level across the region;

there really needs to be a driver of the project; people to push it;

the need to look at difficult things to be addressed where there will be real benefits
and concentrate on them

bigger councils often have the resources and therefore there is no or little real benefit
for these councils in participating

financial impacts for smaller councils prevented them from participating in the project.
It was also suggested that next time this group of Councils would go straight to a regional
approach rather than involve the whole region. It was reported that this was happening with
other collaborative arrangements in the region. For example it seems that Tumby Bay,
Lower Eyre Peninsula and the City of Port Lincoln are looking at shared services
opportunities.
3.1.3
Commitment to Shared Services
As is the case with all other groups, it appears that Councils in the EPLGA are looking at
other opportunities for collaborative or shared arrangements. It was expressed that there is
real commitment however they really need to get some runs on the board. Small clusters
working together is more likely to be successful than the whole of the Eyre Peninsula
approach.
3.2
The Far North Councils – Development of a Shared Services Model – A
Sustainable Future for Local Government
This pilot project initially involved four Councils (Peterborough, Flinders Ranges, Orroroo
Carrieton and Mt Remarkable); the Flinders Shared Services Group.
The project envisaged the creation of a regional subsidiary for the provision of Corporate
Services. A consultant, John Devine undertook the cost benefit which resulted in the
proposal to create a regional subsidiary. This identified significant financial benefits to
Councils.
Despite having initial support from all the Councils the District Council of Peterborough
resolved not to participate in the implementation phase. This resulted in the three remaining
Councils costing the project based on the participation of three Councils. In addition to this
project the Councils participated in another project conducted by the Local Government
Association which provided a governance audit for individual Councils and on a regional
basis. This report highlighted the biggest priorities for these Councils.
Based on the highlighted priorities of the governance audit, the three Councils identified the
need for resources in governance, information technology and asset management; areas
that were also identified in the shared services pilot project as forming part of the regional
subsidiary and skill sets that are difficult to get and retain for the long term in the country.
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However it appears that the regional subsidiary model was no longer viable due to the
reduction in the quantity of work and the associated financial impacts.
The Councils are therefore have changed their approach and now wish to share three
positions to be jointly funded by the federal government, the Local Government Reform Fund
and the Central Local Government Region and each Council. Based on the model Councils
will be contributing an average of $100000 pa each over five years. The financial model this
group of Councils have developed will result in the positions being fully funded by Council in
five years.
3.2.1 Project Status
From the feedback provided the proposal to develop a Regional Subsidiary is no longer
viable. As a result Councils are now pursuing a different approach to provide them with the
resources they need to address the gaps identified in the governance audit. This approach
is sharing resources for governance, information technology and asset management.
Councils believe that this is a continuation of the original project.
It seems that Councils are keen to move forward and are seeking further funding to do so.
3.2.2 Benefits and Challenges
The benefits identified of this collaborative approach are:
 that it will free up other staff to undertake their core roles

reduce the additional workload currently undertaken by CEO’s which falls outside
what would be considered a CEO’s normal role

address those priority areas identified in the governance audit
Challenges and pitfalls identified included:
 financial issues associated with one Council withdrawing from the shared services
project

CEO’s driving and doing all the work and trying to manage this in conjunction with
their core responsibilities

access to funding. Evidently, this group of Councils understood that participating in
these projects (shared services and the governance audit) was a prerequisite to
getting funding

time management associated with sharing resources

the need to get over the parochialism and operate at the strategic regional level

ethical issues associated with recognising that shared resources work for different
organisations and therefore have information which is confidential that cannot be
shared with other members of the group.
This group found that through their previous experience in working collaboratively together
they had built strong relationships. This together with the fact the CEO’s and Mayors were
involved enabled the parties to work cooperatively to achieve a positive outcome that they
are all committed too.
3.2.3 Commitment to Shared Services
This group is very committed to working collaboratively together. They have a Shared
Services group which still meet. Currently this group is currently in the final stages of
developing a joint Disaster Management Plan.
3.3
Adjoining SE Coastal Councils (Robe and Kingston) – Joint Delivery of
Engineering Services
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This project involved the sharing of the delivery of engineering services between the Robe
Council and the District Council of Kingston. Discussions were held with the CEO of the
District Council of Kingston and the Acting CEO of Robe Council.
3.3.1 Project Status
It appears that the joint sharing of engineering services never really got off the ground, there
was a little bit of sharing; however it appears that engineering systems were not mature
enough and it never really reached a point where it could be justified. According to one of
the CEO’s the project morphed into sharing building surveying and development resources.
This was an area of greater need than engineering services. This shared arrangement is
continuing and is working well.
3.3.2 Benefits and Challenges
Benefits identified through discussions with the CEO’s were:
 the Councils benefited through access to affordable resources and resourcing
identified needs

the position incumbent has benefited through greater exposure to a greater variety of
issues

positive relationships have been built between staff of the Councils.
With regard to challenges it was reported that there can be a bit of blurring the lines.
Regular meetings and positive relationships between the parties can sort these issues out.
3.3.3 Sustainability
The arrangements generated through this project were considered to be long lasting.
3.3.4 Commitment to Shared Services
The parties to this project indicated they had prior positive experiences of sharing resources
in the areas of environmental health, occupational health and safety and accounting with the
Wattle Range Council.
Both indicated they were prepared to undertake shared services again. It was considered
there were greater benefits than just services to the community. Other benefits were
identified as creating recruitment opportunities and the positive HR outcomes (e.g. sharing
knowledge and ideas, staff development, building relationships) through such an
arrangement.
3.4
South East Local Government Association - Common Policy and Specification
documentation for Councils procurement
This shared services pilot project involved the South East Local Government Association
(SELGA) Councils (The District Councils of Grant, Kingston, Naracoorte Lucindale, Robe,
Tatiara, Wattle Range and the City of Mount Gambier). Discussions were held with four of
the seven CEO’s, SELGA’s Executive Officer and John Fisher from Local Government
Corporate Services. One of the CEO’s was Acting and was unable to provide comments
regarding this pilot project.
The pilot project focussed on the development and implementation of common policy and
specification documentation for Councils procurement activities. SELGA Councils
commissioned John Fisher from Local Government Corporate Services to prepare the
documentation.
3.4.1 Project Status
This project has been completed and the SELGA Procurement Guide has been provided to
all SELGA Councils and SELGA.
Evidently there is a further project stage to be completed which involves undertaking a joint
procurement exercise using the guidelines. At this stage this has not occurred. It was
reported that progress has been slow and that it seems to have been put on the back burner
by the parties. However it does appear that the SELGA Councils are still working on other
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joint arrangements e.g. a joint specification has been developed for a joint de sludging
project. Five of the seven Councils are involved in this project.
Two Councils indicated they used the Procurement Guide and templates while another
indicated they hadn’t used it a lot. SELGA has also used it for a recent tender.
3.4.2 Benefits and Challenges
It seems that most of those interviewed indicated they had benefited through the materials
provided.
The challenges/pitfalls identified from discussion with CEO’s and the Executive Officer of
SELGA were:
 progress is slowed through being distracted by Council’s core business, different
priorities, other projects and other issues on SELGA’s agenda

the difficulty in bringing about the required changes in procurement practices due to
staff resistance to change; they are used to doing it their way; they don’t like change

need to buy in by all the parties from day one; some pay lip service. Everyone said
they were in, but not all were as passionate

the different levels of enthusiasm for the project

benefits differ between bigger councils and small councils with bigger councils not
necessarily benefiting as much. This can have an impact on buy in.

the need to have a driver or a disciple to drive the project to get it over the line.

the nature of the project had in some cases an impact on existing suppliers (e.g. local
in the town); one Council had experienced problems in this area whereas another
advised there was caution to ensure there were no flow on effects.

while the CEO’s ran this project there may have been benefits in involving
procurement staff in the project which could have assisted with the change required.
As was the case with the Flinders Shared Services Group the issue that worked really well
for the SELGA Councils was their commitment to working collaboratively together. Evidently
these Councils have a formal structure that supports working collaboratively through bymonthly face to face meetings as well as a by-monthly meeting by telephone hook-up.
3.4.3 Commitment to Shared Services
Overall it was considered there is still a commitment to shared services in the region;
however the view was expressed that it will be interesting to see what impact if any the
change of CEO’s in the region has on this commitment. There was a view expressed that
parties need to consider other options than sharing people.
3.5
Fleurieu Councils – Governance Structures to Formalise Regional Cooperation
The objective of this project was to identify a formal governance structure to support
collaborative arrangements for regional economic development and other key regional
initiatives in order to improve the long term sustainability of the Fleurieu and Kangaroo Island
Councils and their region.
This project was between four Councils; the Alexandrina Council, the District Council of
Yankalilla, the City of Victor Harbor and the Kangaroo Island Council. It is important to note
that these Councils already have collaborative approaches to the delivery of a number of
services including information technology services, waste management etc.
3.5.1 Project Status
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Feedback provided by two of the participant Council’s CEO indicate that the project never
really went past the scoping phase. The reasons provided for this were that:
 the establishment of Regional Development Australia

change of CEO’s in participating Council

failing of each of the Councils; struggling to keep their heads above water

there was not the time or resources to dedicate to it. For example at the same time
the Councils were in the process of establishing a regional Waste Management
Authority.
3.5.2 Benefits and Challenges
While not being able to identify any benefits and challenges associated with this project, the
CEO’s provided some general views about shared services and the challenges they have
experienced.
Issues identified were:
 it is essential to have the commitment of all the CEO’s

there needs to be a driver; someone passionate about the project to get it over the
line

time is the biggest obstacle to success

difficult with different sized Councils. Larger Councils may not get the benefits which
can impact on the level of their involvement.

need an agreement in principle for standard charges for the services shared

there will be swings and roundabouts; but no one wants the roundabouts.
3.5.3 Commitment to Shared Services
Both CEO’s indicated they believed shared services or collaborative arrangements are
viable and the Councils are still talking about other opportunities.
3.6
Eastern Regional Alliance – Sharing General Inspectorial and Building
Inspection Services.
The Eastern Region Alliance (ERA) (seven metropolitan Councils; Norwood, Payneham and
St Peters; Prospect; Campbelltown; Walkerville; Unley; Tea Tree Gully and Burnside)
agreed to undertaking a pilot project exploring the sharing of Building Inspectorial function
and General Inspection Services. Information was gathered from three Councils. Two of
these Councils’ CEO’s were part of the project scoping. In terms of the remaining Council
feedback provided indicated there was an awareness of the work of the consultant; however
the project was not considered viable for the Council.
From the information provided it seems that this project did not proceed past the scoping
stage even though the scoping study revealed there were economies of scale to be achieved
by Councils.
It appears that this was one of the options for collaborative arrangements that this group was
considering.
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Reasons for the project not getting passed the scoping stage were identified as:




ERA was distracted with other issues e.g. a joint approach to the 30 year plan
the project did not have the support of the CEO’s; evidently some were interested
and others were not
ERA as a group of Councils was relatively new and not mature. It was considered
that the result would be different if the project was undertaken today
ERA has focussed on other issues where they have considered they are getting
’bigger bangs for their buck’
3.6.1 Benefits and Challenges
While this project did not evolve it was considered there were benefits including:
 It is valuable piece of work that is still valid

The project provided a foundation for Councils embarking down the path of other
shared services arrangements e.g. the City of Tea Tree Gully providing IT services to
the City of Prospect

It encouraged Councils to look at other projects

The funding was useful in assisting Councils.
Regarding the scoping study there was a view expressed that the actual investigation
process was well received by the participating Councils.
As was the case with other projects challenges identified were associated with CEO’s
support and commitment for the project. It was considered if the CEO’s are not interested it
will not happen. Another challenge identified was some Council’s priorities being driven by
political views rather than the needs of Councils.
For shared services to be successful it was considered there needs to be:
 a genuine desire from all the parties

benefits to all who participate

an identified need (e.g. the ERA waterproofing project); instead of we think it’s a
good idea

real commitment from the CEO’s and the next level down

a passionate group of people driving and owning it to get it finished.
Another challenge is that some Council’s priorities are driven by political views rather than
the needs of Councils.
3.6.2 Commitment to Shared Services
It was considered that there is still commitment from this group of Councils to pursue
collaborative/shared arrangements, for example this group is currently looking at a regional
approach to the new roof truss legislation.
In addition it was considered that investment by the Local Government Association is critical
to get something really special up and running in terms of shared services.
3.7
Findings Summary
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In summary evidence indicates that the Working Together for Stronger Communities Shared
Services pilot projects appear to have had limited success in terms of achieving pilot project
outcomes. However it could be argued that there have been considerable benefits regarding
lessons learntas well as providing the platform and encouragement for Councils to pursue
further shared services or collaborative arrangement.
Out of the six pilot projects
 two have developed guidelines and template documents; one for human resources
and the other procurement. While there appears to be no problems with the
documentation provided it seems that in the case of one pilot project these
documents are not fully utilised by all the participating Councils;

two did not advanced past the scoping phase;

one has been unable to advance to what participant’s consider to be the next stage
due to financial resourcing issues and

one pilot project which turned into sharing building and development rather than
engineering services is considered to be a sustainable arrangement.
With regard to challenges and pitfalls the most common issues identified were:
 The need to have commitment from all the CEO’s and senior staff; buy in from day
one, a genuine desire by the parties to share services, resources or have other
collaborative arrangements

Difficulties associated with different sized Councils i.e. bigger Councils may not get
the benefits which may influence their level of participation in shared services or
collaborative arrangements

The need for time and resources to dedicate to the project

Other distractions and changes in CEO’s can either slow or stop the project
completely

Need for an individual or group that is passionate, a driver of the project to ensure
the project gets over the line

The need to move above the political and parochialism to the strategic regional level

Being distracted by other priorities and core business.
In addition it appears that Councils who already had other collaborative arrangements in
place and had subsequently built positive relationships found this assisted them in the pilot
project.
Overall it is seems that Councils recognise that there are benefits from undertaking
collaborative arrangements with other Councils and are committed to exploring such
arrangements further.
A number of Councils that participated in the pilot projects already had collaborative
arrangements in place. It appears from the information provided that the most common
arrangement seems to be the sharing of resources. There was only one group that identified
they had established a formalised regional structure i.e. a regional waste subsidiary.
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4
Conclusion
As mentioned in earlier in this report, The Independent Inquiry into the Financial
Sustainability of Local Government in October 2005 recommended “that in canvassing
alternative methods of delivery, Councils consider further resource-sharing initiatives,
especially involving the smaller Councils, ranging from working together more effectively to
more formalised regional groups, area integration and whole-of-sector initiatives.”
While not all pilot projects in the Local Government Association Working Together for
Stronger Communities Shared Services program have achieved the desired outcomes, it
could be argued that projects have provided the opportunity for Councils, particularly smaller
Councils, to work together collaboratively and the experiences gained through participating
in these and other collaborative projects have provided valuable lessons that can be applied
in future projects.
Further information gathered through this review indicates that Councils that participated in
the pilot projects are committed to exploring other opportunities to engage in collaborative
arrangements and in a number of cases continue to do so.
The sustainability of these arrangements will depend on all Councils benefiting and Councils
ability to operate at the strategic group level rather than individual Council level.
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