There are new provisions of the Local Government Act 2020, which require councils to take an integrated approach to strategic planning and reporting. Due to the principles based nature of the Act, Local Government Victoria is seeking to avoid being prescriptive in ‘telling’ councils how to implement the strategic planning and reporting sections of the Act, and to rather work with councils to identify and design the supports councils may need to implement the provisions of the Act. This will be an ongoing conversation.

Co-design process

The co-design process ran from August to October 2020 with participation from the sector based on the remit:

How do we make strategic planning and reporting more integrated so that it works better for councils and their communities?

LGV developed a draft integrated strategic planning and reporting framework (‘the framework’) for consideration by councils.

From the feedback received through the co-design process, this paper has been updated and refined. It has been sectioned into parts so that the sector can more easily find the information it needs.

Support Material

Finalised planning and reporting guides and templates to assist councils with planning, budgeting and reporting requirements can be found here: Sector guidance: planning and reporting (localgovernment.vic.gov.au)

Thank you to everyone that provided feedback during the development phase of these documents.

A word version of this information is found here.

This document has been prepared to provide broad guidance on how local governments may meet their obligations under the Local Government Act 2020.

This is not a ‘how to implement the Act’ but seeks to identify the key issues that local governments should give consideration to when responding to the requirements of the Act.

This document, prepared by Local Government Victoria with the support of Mach 2 Consulting Pty Ltd, draws upon their many years of experience both within the sector and when working for the sector. Most importantly, the concepts and theories identified in this paper have been the subject of extensive consultation with key local government operatives through a co-design process facilitated by MosaicLab. The refinement through these forums has provided a greater sense of clarity and purpose behind an Integrated Strategic Planning and Reporting Framework.

This paper does not define the ‘how to’. It is not intended to be a ‘one size fits all’ manual for all local governments.

The concept of co-design which is being pursued here, is acknowledgement that local governments know best how to respond to their communities needs and aspirations, and the capacity of their organisation to deliver on same. It is not the role of Local Government Victoria to set standards. The Local Government Act 2020 has articulated the over-arching principles and need for good governance, Local Government Victoria will provide a conduit to support the design by the sector, for the sector.

This paper represents a collation of the various inputs from stakeholders on how the sector may best respond to the opportunities provided by the Local Government Act 2020.

The Local Government Act 2020 signals four key shifts in strategic planning and reporting arrangements that will require Council engagement and response, these are:

  • Community Vision – the Act aims to bring community and its aspirations and longer-term sustainable thinking to the core of policy and strategy development, planning and fiscal management
  • Outcomes focus – a deliberate move to a principles-based Act shifts regulatory focus from prescriptive rules and defined processes towards broadly stated principles and strategic outcomes
  • Community engagement – rather than prescribing requirements for community engagement all Councils must now develop appropriate consultation mechanisms (including deliberative engagement) in the context of their community and incorporate these into a policy to be adopted by 1 March 2021
  • Additional requirements – new medium and long-term planning elements have been incorporated in the Financial Plan, Asset Plan and Workforce Plan

Probably the biggest change for Victorian local government is the move from a more prescriptive form of legislation to the new Act that enables and encourages decisions to be made, powers to be exercised, or functions performed in line with broadly stated principles.

Principles-based legislation is designed to create the conditions for innovation and growth and stimulate adaptive responses that consider and reflect:

  • The local needs of the community
  • The social, economic, environmental, and cultural context
  • The capacity of the individual Council

Regulation, directions, and guidelines issued from the core of government are considered counter-productive to the design-principles, objectives, and intent of the new Act. To this end Local Government Victoria (LGV) intends to work in partnership with the sector to foster the development of support materials that are sector-led and not imposed.

The Act signals a transfer of responsibility and accountability to each individual Council and sets the framework for long-term improvement of sector good governance that considers and is responsive to local community needs.

It drives an integrated approach to planning and reporting to support strategic decision-making through:

  • recognising that planning must be holistic and driven by the community
  • providing a comprehensive view of available resources and commitments
  • enabling alignment of objectives and capabilities, and
  • supporting an understanding of medium to long-term implications of decisions on resource allocation and Council performance.

The key expectations of an integrated strategic planning and reporting framework include:

  • all elements and parts of the framework are linked and interdependent
  • there are both explicit and implicit linkages and interdependencies:
    • from community aspirations, highest order directional statements and regional, state, and national plans and partnerships
    • through the strategic objectives, strategies, initiatives, and activities
    • to performance reporting against progress or achievement of intended outcomes
  • a cascade effect should be evident from higher order plans through resource allocation to performance monitoring and accountability mechanisms
  • each element of the integrated framework has one or more specific functions or purpose.

A word version of this information is found here.

Purpose

The framework information has been designed to assist councils as they implement the Strategic Planning Principles of the Local Government At 2020 and to take an integrated approach to planning, monitoring and performance reporting. Its purpose to help achieve best practice for councils and better outcomes for communities.

The intent of the information is to add value and build on the current planning approaches and expertise of councils, not to replace the work of councils.

Because each council is different, the legislation and essential elements of the framework will be applied in different ways. How they are applied will depend on the geographical location, demographics and culture of the council area.

It also recognises that council plans and policies should not exist in isolation and that they are connected. This framework allows councils to draw their various plans together, understand how they interact and get the maximum leverage from their efforts by planning holistically.

The planning process can also help councils to better connect with their communities to gain a more detailed understanding of their area and its regional context. The process can also provide opportunities for councils to streamline their operations in the future.

Co-design Process

Local Government Victoria (LGV) is responsible for managing and overseeing the implementation phase of the Act. As the Act is a principles based Act, LGV is seeking not to be prescriptive in ‘telling’ councils how to implement the strategic planning sections of the Act but rather to work with councils and ‘codesign’ those supports identified as being needed by councils to implement the provisions of the Act.

The purpose of co-design was to consider and improve the Integrated Strategic Planning and Reporting Framework draft overview as one of the key supports along with identifying all other supports needed by councils.

Over the course of July – October 2020, LGV facilitated a range of workshops and webinars focused on supporting councils in the development of an Integrated Strategic Planning and Reporting Framework. Further, to show how to bring the strategic documents together, exploring the implicit and explicit relationships between the components, and other important documents the council needs to deliver in the first 12 to 18 months of their term.

The work covers the legislative provisions in relation to:

Round 1 identified ideas from mixed groups of sector staff with varying levels and range of experience, and types of councils. Round 2 involved a deep dive into the supports that the sector requires, to ensure they are fit for purpose, scalable to each council’s circumstance and shared widely.

The outputs of the co-design process were captured as a set of short, medium and long term actions. As an example, in the short term; the role and ownership by elected officials, and leadership by council CEO’s and the executive, and in the long term, developing communities of practice and technical shared platforms.

Way forward

The mayor, as spokesperson for the council, is the public face of the planning process. The mayor is responsible for explaining the purpose of the Community Strategic Plan to the community and encouraging public support for the planning process. The ability of the mayor and the councillors to capture a vision for the community’s future and inspire others to participate in that future, will be fundamental to the success of the project. It is important that all councillors support this aim and are fully committed to the value of the project.

Key considerations:

  • The success of the ISPRF planning process relies on the commitment of the mayor and the executive as well as all councillors. Without strong support and commitment, the council will find it difficult to develop and implement a meaningful plan.
  • LGV has a leadership role in facilitating and continuing the support for councils to enable continuous improvement
  • Support materials for councils must be fit for purpose, scalable to each council’s circumstance (local conditions, capacity and capability) and shared widely;
  • The development and delivery of an integrated strategic planning and reporting framework is an evolving process;
  • Continuous improvement will be derived from lessons learned by the community, councillors and council officers;
  • Councils will seek to achieve compliance in year 1 whilst also continuing to contribute to technical resources for model budget, financial statements and long-term financial plan.
  • LGV to support a sector-led approach to service planning which will link to the ISPRF.

Note. The co-design workshops acknowledged the element of technical compliance in budgets and financial statements. As stated in the Planning and Reporting Regulation, LGV will continue to facilitate the production of the Model Accounts annually.

The word version of this document can be found here.

A narrative snapshot

The requirement to develop a Community Vision (s 88) (applying deliberative community engagement processes) is intended to ensure that councils incorporate a long-term view (more than 10 years) of the community’s desired future into strategic planning. Deliberative engagement assumes there will be investment in processes to facilitate and support broad community input with high quality information and time allowed for this to be effectively processed.

A Community Vision is a consensus aspirational view of a desired future and community values that should extend beyond the traditional jurisdiction of a Council into areas that might be considered the responsibility and function of other levels of government, civil society, non-government organisations, the private sector, institutions or other entities. It will also consider the role and potential contribution of resources or in-kind effort of these other stakeholders.

A Community Vision focuses on the whole community and crosses jurisdictional boundaries. It responds to three key questions:

Where do we want to be?

Where are we now?

How do we get there?

A Community Vision should be multi-dimensional, it should consider:

A Community Vision can be articulated through a range of different communications media (i.e. not just a document). For example, a Community Vision could be articulated visually, through artworks, literature etc or a combination of these.

The Community Vision will articulate the community’s priorities in terms of how it sees a desired future. The Vision will be expressed in high-level terms of the ‘look, feel and liveability’ of the community in which the people live and work. Whilst the Community Vision includes the Council’s role in the community, it is not limited to its jurisdictional footprint and therefore can be much wider in scope.

Being essentially an aspirational document, the Community Vision should be ambitious. It should describe a ‘future state’ of the community that is broadly aspired to, without necessarily delving into the detail of how this will be achieved. This can create tension and energy to motivate collaborative action which can then be directed towards achieving major directional change and goals. Recognising the value of ambition, the Vision should also be tempered by a level of pragmatism in terms of overall resource constraints, as well as what might be possible through advocacy, influence, community partnerships, and inter-governmental collaboration.

There might not be an expectation that a bold Community Vision will be universally supported by the wider community, but it should be widely understood, embraced and co-owned by the Council and community.

The Council Plan (s 90) describes that Council’s strategic priorities and directions in the broader context of the Community Vision and adopted policies, strategies, and plans (including the Municipal Strategic Statement and Municipal Public Health Plan). It is focused on the Council’s role within its jurisdictional footprint but in term of advocacy and seeking to lead broad directions and change, it can be much wider.

The Council Plan is a medium-term (at least 4-years), it is adopted and owned by an incoming Council and reflects the ambitions and philosophy of the elected Council. Whilst strongly aligned to and referencing the Community Vision, it is not constrained to this agenda alone: it should incorporate broader and different objectives. The Council Plan is the primary document to reflect the strategic agenda of the Council and it outlines clear strategic objectives, strategies, major initiatives and must contemplate the resources required to support delivery.

The Financial Plan (s 91) is developed and adopted by Council to provide a long-term view of the resources that are expected to be available to Council and the proposed/predicted application/use of those resources over a 10 year period. The Financial Plan should cover all aspects of the Council’s role including services/operations and capital investment/assets. It should also describe the proposed sources of funds it proposes to have access to and include all the high-level assumptions under-pinning the Plan.

The Financial Plan shows how the viability and financial sustainability of Council will be achieved over the 10-year period. In the shorter term (up to 4-years), it should show the resources required to implement the Council Plan and other legislated responsibilities. The Financial Plan defines the broad fiscal boundaries for the Council Plan, Asset Plan, other subordinate policies and strategies and budget processes. It should include 10-year forecasts across the mandated key financial statements: income statement, cash flow statement, balance sheet, statement of changes of equity, capital works statement and statement of human resources.

The relationship between the Financial Plan, the Council Plan, the Asset Plan and all other strategies and plans should be transparent and identified.

The Asset Plan (s 92) also has a longer-term outlook (10+ years). It provides a view (both strategic and in financial terms) of how the Council proposes to manage the full portfolio of assets that it owns and controls. It should define the Council’s high-level strategic asset management priorities. It needs to address all aspects of asset management including maintenance, renewal, acquisition, expansion, disposal or decommissioning of all classes of community assets under the control of Council.

Effective stewardship of assets assumes that assets (facilities, buildings, roads, paths etc) exist to support the delivery of service outcomes to the community. This implies that Council will develop and adopt functional service level standards across all classes of assets. The Asset Plan should define these functional performance standards for each asset class/type, as well as the necessary investments that will be required to achieve this (i.e. maintenance, renewals, new investment).

Assets will be managed through technical processes that consider the age and condition of assets as well as the fitness-for-purpose to deliver against adopted performance standards.

Councils must prepare a Budget (s 94) for each financial year and the subsequent 3 financial years. This rolling 4-year budget is to be prepared in the form and include information required by regulations. The budget will outline how resources will be allocated across initiatives, programs, services, and capital works, as well as financing and debt redemption/servicing. It also provides a comprehensive outline of all income derived from rates, fees and charges, grants, and other revenue.

Ongoing services and programs should be described in summary form and include prescribed indicators and measures of service performance. New strategies and initiatives flowing from the Council Plan proposed to be implemented in each of the financial years should be clearly described with cost, income and capital estimates provided for each.

The budget has an important role to ensure:

  • allocation of adequate resources to deliver the planned programs and services to the targeted quality and cost standards
  • implementation of major initiatives and projects aligned with Council Plan and Community Vision
  • clarity on what services, programs and activities Council provides
  • a fully funded and financially sustainable capital works program, and
  • the overall financial viability of the Council is maintained.

A Revenue and Rating Plan (s 93) is also to be prepared and adopted by Council for a 4-year ‘block’ period following each general election. It is to be prepared by 30 June in the year following every election for the subsequent 4-years.

The Revenue and Rating Plan establishes the ‘revenue-raising envelope’ within which Council proposes to work. It provides the framework for the setting of rates, statutory charges, service fees and charges and other income sources. To do this, it also needs to define (i.e. make assumptions regarding) the levels of non-controlled revenues that the Council expects to generate over the 4-year period as well (i.e. grants and subsidies, contributions etc.).

In addition, it needs to define the amounts of rates to be generated from different ratepayer/property classes through differential rates (or through a uniform rate as the case may be). The Revenue and Rating Plan therefore defines what each source of revenue is, how income will be raised and the policy rationale/assumptions for each, to fund required the proposed expenditure included in the 4-year budget.

The Chief Executive Officer is required to prepare a Workforce Plan (s 46(4)) that describes the organisational structure of the Council and specifies projected staffing requirements for a period of at least 4 years. There is no formal requirement for this to be linked to budget or other resource allocation processes, however it would make sense to ensure alignment.

Council must prepare an Annual Report (s 98) for each financial year. The Annual Report is a retrospective accountability document that includes:

  • a report on operations and an audited performance statement
  • audited financial statements and a copy of the auditor’s report
  • a statement on progress on implementation of the Council Plan (including strategic indicators) and major initiatives
  • performance against the prescribed indicators of service performance

Council must approve performance and financial statements on an in-principle basis prior to audit and must hold a meeting open to the public to consider the Annual Report, at this meeting the Mayor must report to the community on the implementation of the Council Plan (s 100 (1)).

The word version of this document can be found here.

The Integrated Strategic Planning and Reporting Framework, for some local governments, is a significant departure from current practices. The principles of integration, of community engagement and deliberative engagement all require a change of mindset.

A small change for some, more significant for others.

The expectations and levels of trust amongst different stakeholders will no doubt inform early perceptions of many. The ISPRF will require constant refinement as the various parties begin to understand the opportunities such a framework does provide.

The Local Government Act has recognised the importance of ‘service performance principles’ that guide the way services are defined and delivered. There are core capabilities and systems that Councils can use to assist and improve the development of an integrated approach to strategic planning and reporting framework.

Service performance principles in Section 106 of the Local Government Act 2020:

(1) A Council must plan and deliver services to the municipal community in accordance with the service performance principles.

(2) The following are the service performance principles—

(a) services should be provided in an equitable manner and be responsive to the diverse needs of the municipal community;

(b) services should be accessible to the members of the municipal community for whom the services are intended;

(c) quality and costs standards for services set by the Council should provide good value to the municipal community;

(d) a Council should seek to continuously improve service delivery to the municipal community in response to performance monitoring;

(e) service delivery must include a fair and effective process for considering and responding to complaints about service provision.

Many councils would contend that this is the way they ‘currently go about their business’, however the requirements of the Local Government Act 2020 provide opportunity into the future to further strengthen this relationship.

The integration of these principles can be further enhanced when combined with a stronger commitment of aligning asset management to service standards and principles.

How councils undertake these processes and delivers services currently varies by extent and integration within councils. It is important to acknowledge that the journey to best practice is an iterative one in which the sector can continue to build in terms of awareness of the role of service planning and service review processes.

Business & Service Planning

The Service performance principles require councils to plan and deliver services that have established quality and cost standards, continuous improvement processes and are equitably delivered. Many councils have developed ‘service planning’ processes that catalogue and define internal and external services delivered on behalf of the community. These include:

  • rationale, mandate, and authorising environment for the service
  • policy objectives associated with the service – what is council seeking to achieve
  • quality and cost standards associated with the service
  • intended target groups and medium-term needs and challenges
  • financial and asset requirements to support the delivery of the service
  • key internal relationships and dependencies
  • budgets and resources required to effectively manage delivery
  • services, programs, and activities delivered
  • projects managed – including Council Plan initiatives
  • policy or strategies developed
  • risk and audit initiatives
  • the requirement for greater financial accountability and stewardship of community assets and resources in response changing community demands
  • the need for councils to be able to better understand and respond to changing dynamics and community needs
  • to prepare and respond to the impact of reform processes and emerging technologies
  • to make informed decisions regarding quality standards and levels of service in the context of Council’s statutory and legislated responsibilities
  • to seek performance improvement and efficiencies to free up resources for reinvestment into renewal of assets or improved services, and
  • to better define and clarify the investment in services and the outcomes that it is seeking to achieve.
  • internal governance – executive as the principal internal coordinating group responsible for achievement of outcomes supported by effective governance and coordinating processes
  • organisational culture – building the right internal culture to support integrated operations and alignment of strategic objectives
  • change and transition management – ensuring that human resource managers are engaged, and cultural change expertise is used to support the transition process
  • supporting technology – systems and processes to track and monitor implementation of corporate initiatives and monitor performance
  • project management – whole of council approach to managing project implementation and realising intended benefits
  • outcomes framework – shifting planning and delivery focus from outputs to monitoring achievement of longer-term outcomes

Many organisations use business planning to group services under an administrative structure to ensure accountability, effective management, strategic alignment, and control. Business plans might include:

Service Review

Inherent in the requirements of the Act are processes that ensure effective alignment of services with changing environment and needs as well as continuously improvement in response to performance monitoring.

A service review is a structured and formalised process that aims to drive and deliver more efficient and effective use of Council and community resources.

The rationale and drivers for the conduct strategic reviews of services include:

Figure 6: Service planning and review framework – indicative only

Other supporting capabilities

Additional supporting capabilities that councils might need to consider include:

A word version of this document can be found here.

Overarching Policies and Principles

The ISPRF cannot be developed in isolation from both internal demands and externalities. There will be components considered ‘business as usual’ and some for which council has legal responsibility to deliver. There are however a large number of other opportunities that need to be considered and in some instances refined through the ‘sieve’ of governance principles.

The Act establishes Overarching Governance Principles (s 9) that must be given effect through the performance of a Council’s role, with some having specific reference to the integrated strategic planning and reporting framework include:

  • priority to be given to achieving the best outcomes for the municipal community including future generations
  • economic, social, and environmental sustainability (including climate change risk) is to be promoted
  • the community is to be engaged in strategic planning and strategic decision making
  • innovation and continuous improvement are to be pursued
  • collaboration with other Councils and statutory bodies is to be pursued
  • ongoing financial viability of the Council is to be ensured
  • regional, state, and national plans are to be taken into account
  • transparency of decisions and actions is to be ensured

Figure 7 – Application of Principles: Integrated Strategic Planning and Reporting Framework

Strategic planning principles (s 89) require councils to:

  • adopt an integrated approach to planning monitoring and performance reporting
  • ensure strategic planning addresses the Community Vision
  • consider the resources needed for effective implementation
  • identify and address the risks to effective implementation
  • provide for ongoing monitoring of progress and regular reviews to identify and address changing circumstances

Financial management principles (s 101) require councils to:

  • manage finances in accordance with financial policies and strategic plans
  • monitor and manage financial risks prudently
  • provide stability and predictability in the financial impact of decisions
  • explain the financial operations and financial position by keeping appropriate records

Service performance principles (s 106) require councils to:

  • plan and deliver services according to the Service Performance Principles
  • provide services in an equitable manner and be responsive to diverse needs
  • ensure services are accessible to intended target groups
  • establish quality and cost standards to provide good value
  • continuously improve services in response to performance monitoring
  • include fair and effective processes for considering and responding to complaints

Supporting policies and principles

Councils must develop, adopt, and maintain a Community Engagement Policy (s 55) in consultation with the community to give effect to the community engagement principles (s 56). The Policy must:

  • be capable of being applied to the making of Council’s local laws, budget, and policy development
  • describe the type and form of community engagement having regard to the significance and complexity of the matter and the level of resourcing required
  • specify a process for informing the community of the outcome
  • include deliberative engagement practices that can be applied to the development of the Community Vision, Council Plan, Financial Plan and Asset Plan

The Local Government Act 1989 included a Right to Make a Submission (s 223) process that applied to a wide range of Council processes and activities. This obligation has effectively transferred to the Community Engagement Policy and each Council will now need to determine how and when it will engage with the community on a wide range of matters including strategic planning and reporting.

The community engagement policy will need to consider and outline how Council intends to engage on the following matters:

  • Development or review of the Community Vision (s 88) *
  • Preparation and adoption of the Council Plan (s 90) *
  • Development, adoption, and review of the Financial Plan (s 91) *
  • Development, adoption, and review of the Asset Plan (s 92) *
  • Electoral structure review (s 16)
  • Governance rules (s 60)
  • Proposing and making a local law (s 73)
  • Budget or Revised budget (s 95 & 96)
  • Compulsory acquisition of land (s 112)
  • Selling, exchange or lease of land (s 114 & 115)

(* These provisions also include a requirement for deliberative engagement practices.)

The Act requires Council to develop and adopt a Public Transparency Policy (s 57) (on or before 1 September 2020) that gives effect to Public Transparency Principles (s 56). The intention is that there is public transparency to decision making processes and that Council information, including all key documents, policies, strategies, and plans should be understandable and accessible to members of the community.

As part of the process for planning and commissioning how its integrated strategic planning and reporting framework and supporting processes will be implemented, all Councils must consider how they will ensure:

  • decision making processes related to strategic planning and reporting is transparent – how will the community be involved and engaged in the decision process?
  • information including plans, strategies and reports are publicly available – what does publicly available mean beyond putting copies on a website or in a library?
  • information is understandable and accessible to the community – are there cultural, educational and literacy impediments to community members understanding information or accessing processes?
  • awareness of the availability of the information must be facilitated – what steps does Council have to take to raise awareness and understanding?

Technical descriptions

This section provides a more in-depth look at the individual elements within the Integrated Strategic Planning and Reporting Framework.

A word version of this information is found here.


Requirements

Council must develop, maintain, and review a Community Vision with its municipal community using deliberative engagement practices.

The Community Vision has an outlook of at least 10 years and describe the municipal community’s aspirations for the future of the municipality.

It should describe the social, economic, cultural, and environmental aspirations for the future of the municipality.

Key dates

Adopt by 31 October in the year following a general election

It has effect from 1 July in the year following a general election.

Accountability and who is engaged?

The Council:

  • is responsible for facilitating the articulation of the Community Vision
  • is responsible for maintaining and reviewing the Community Vision
  • must ensure that an appropriate community engagement policy which includes deliberative engagement practices is adopted, and
  • needs to provide directions and resources to the Executive to inform the development the Community Vision.
  • providing background data and planning information
  • facilitating community engagement
  • integrates feedback and outcomes into relevant service, asset and land-use programs to develop an achievable Community Vision
  • formally initiate a community visioning process
  • determine how it will satisfy deliberative engagement requirements
  • consider how they will establish a framework for community dialogue
  • analyse strategic options and gain consensus and legitimacy for a preferred future
  • establish a program for implementation that outlines the roles and responsibilities of Council and other stakeholders

The Executive designs and implements a transparent process with the genuine aim of understanding the aspirations of the community, this may include:

The Vision will seek to harness and direct resources and contributions from a wide range of stakeholders and community partners, this will include other levels of government, non-government organisations, institutions, and civil society.

The ‘municipal community’ must be consulted and involved through a deliberative consultation processes. This assumes that a broad cross-section of the community needs to be encouraged and supported to be involved in engagement processes.

Connections and relationships

The Community Vision will establish higher-order aspirations for the community and ambitious goals for Council and the community to work towards in collaboration.

It is informed by community engagement and a consensus view on aspirations and it is an influential document informing Council’s strategic planning and broader partnerships with civil society, government community organisations.

The Community Vision extends beyond Council’s jurisdiction and provides a platform for collaboration with community, regional partnerships, and advocacy. It should reflect and consider relevant regional, state, and national plans.

The Community Vision is, in part, an expression of how Council will work with the community to apply and direct resources under its control towards achieving the desired future. The Vision will significantly influence and provide direction to the Council Plan and for other mandated plans and strategies.

Implications

All Councils will need to plan and resource an appropriate process to develop a Community Vision in the period from November 2020 to October 2021 to:

The Community Vision will consider long-term issues such as inter-generational equity, societal changes, environmental impacts, and climate change.

The Community Vision might link to key policies and strategies through setting high-order quality standards for assets, services, programs, and liveability.

A word version of this information is found here.

Requirements

Council must prepare and adopt a Council Plan for a period of at least the next 4 financial years after a general election.

The Council Plan must:

  • the strategic direction of Council
  • strategic objectives for achieving that direction
  • strategies for achieving the objectives (for at least 4 years)
  • strategic indicators for monitoring achievement
  • description of initiatives and priorities for services, infrastructure, and amenity
  • developing background papers and gathering data
  • ensuring linkages are made to adopted strategies, policies, and plans
  • planning and commissioning community engagement processes
  • analysing inputs and information from a broad range of sources regarding priorities and emerging issues
  • framing and proposing broad strategic objectives, strategies, and major initiatives in draft form for Council and community consideration

Key dates

Adopt by 31 October in the year following a general election

It has effect from 1 July in the year following a general election

Accountability and who is engaged?

The Council must own the Council Plan and is responsible for developing, adopting, and maintaining the Plan

The Executive is responsible for working with the Council to prepare the Council Plan and make recommendations to Council for adoption, this will usually include:

The community must be consulted and involved through deliberative engagement and other consultation processes.

Connections and relationships

The Council Plan:

  • outlines the strategic agenda for the Council during its term including the steps it will take to implement the Community Vision
  • will contain a strong narrative of the opportunities and challenges facing Council and how these will be addressed or realised
  • must be respondent to community engagement and aspirations
  • demonstrates linkages and connections to relevant regional, state, and national plans
  • does not address all the things that Council does, but it will reflect the major challenges facing Council and community and outline objectives, strategies, and initiatives to deliver change and positive improvement.
  • is a major influence on the Budget process with transparent links through strategies, initiatives, and performance indicators
  • must consider Financial Plan opportunities and constraints but will also contemplate growing the pool of available resources through partnerships, advocacy, or regional collaboration
  • is informed by, and informs Councils 1 plus 3-year Budget, Rating and Revenue Plan and Workforce Plan
  • has a dynamic relationship with mandated (MSS / MPHP) and other major policies, strategies, and plans
  • performance against strategic indicators and progress on initiatives and major activities in the Council Plan must transparently link through the Budget, Annual Report, and other reporting mechanisms
  • consideration of what parts of the Community Vision will translate into the Council Plan
  • how will the Council Plan be structured and what are the Council’s strategic objectives for the next 4-years?
  • how the community will be engaged in the Council Planning process?
  • how will strategies be developed, tested, and then scheduled across the 4-year period?
  • what are the major initiatives and activities that will be included?
  • what strategic indicators and performance measures will be included to enhance accountability?

Implications

All Councils must resource processes to develop and adopt a Council Plan in the period from October 2020 to October 2021, this will include:

A word version of this information is found here.

Requirements

Council must develop, adopt, and keep in force a Financial Plan with an outlook of at least 10 years.

The Financial Plan must:

  • describe the financial resources required to give effect to the Council Plan and other strategic plans of Council
  • provide information about decisions and assumptions on which it is based
  • outline any other resource requirements considered appropriate or contained in the regulations.
  • Council’s strategic financial planning context and drivers (demographic/economic/community/contextual)
  • Council strategic financial planning drivers (policy)
  • the key assumptions underpinning the Plan
  • 10-year income statement
  • 10-year cash flow statement
  • 10-year balance sheet
  • 10-year statement of changes in equity
  • 10-year capital works statement

The Financial Plan defines the broad fiscal boundaries for the Council Plan, Asset Plan, other subordinate policies and strategies and budget processes.

Key dates

Adopt by 31 October in the year following a general election

It has effect from 1 July in the year following a general election

Accountability and who is engaged?

The Council is responsible for developing, adopting, and maintaining a Financial Plan

The Executive is responsible for preparing a Financial Plan and making recommendations to Council for adoption.

A range of officers from across Council areas (e.g. Asset Management, Capital Works, Service Managers etc) will be required to contribute to the development of the Financial Plan.

The community must be consulted and involved through deliberative consultation processes.

Connections and relationships

The Financial Plan provides a long-term view of the resources that are expected to be available to Council and the proposed/predicted application/use of those resources. It is anticipated that the Plan is updated on a rolling basis to maintain currency.

It should cover all aspects of the Council’s role (services/operations and capital investment/assets) and should also describe the sources of funds that Council proposes/expects to have access to. It should include all the high-level assumptions underpinning the Plan.

Policy and strategy development and service and asset planning should consider and incorporate long-term financial implications of decisions or change of standards. Assumptions underpinning the Financial Plan must be transparent and linked to preparation of budgets, service standards and major initiatives (both operational and capital).

The Financial Plan should show how the viability and financial sustainability of Council will be achieved and maintained over the 10-year period. The focus is on providing stability, predictability and effective mitigation and management of strategic financial risk.

Indicatively, the Financial Plan may include the following:

The Financial Plan is informed by and informs the Council Plan, the Asset Plan, the Budget, Rating and Revenue Plan, Workforce Plan and all other adopted major strategies and plans. The Financial Plan and Asset Plan have a strong symbiotic two-way relationship and the interdependencies should be transparently recognised.

Implications

The Financial Plan is a key indicator of Council capability and will govern the establishment of high-level quality standards and implementation planning for services, major initiatives and policy and strategy development.

Financial and operational modelling feeding into the Financial Plan should consider the long-term implications of decisions by Council.

Council’s strategic risk register should link to the Financial Plan.

A word version of this information is found here.

Requirements

Council must develop, adopt, and keep in force an Asset Plan.

The Asset Plan has an outlook of at least 10 years.

The Asset Plan must include:

  • information about maintenance, renewal, acquisition, expansion, upgrade, disposal, and decommissioning of each class of infrastructure under its control, and
  • outline any other resource requirements considered appropriate
  • adopt by 31 October in the year following a general election, and
  • it has effect from 1 July in the year following a general election
  • levels of service delivered by assets
  • the effective and efficient use of available resources
  • how programs and services are planned and delivered

The Plan has a longer-term outlook (10+ years). It provides a view (both strategic and in financial terms) of how the Council proposes to manage the whole portfolio of assets that it owns and controls.

Key dates

The first Asset Plan under this section must be adopted by 30 June 2022 and has effect from 1 July 2022. Thereafter, the Council must:

Accountability and who is engaged?

The Council acting as a responsible steward of community assets is responsible for developing, adopting, and maintaining an Asset Plan.

The community must be consulted and involved through deliberative consultation processes (Note: deliberative engagement is not mandatory for the first Asset Plan. Council should refer to its Engagement Policy). This will include establishing quality, cost, and provision standards as well as engagement on policy, strategy, and major initiatives.

The Executive is responsible for preparing an Asset Plan and making recommendations to Council for adoption.

Council’s Asset Management team will prepare the Asset Plan from longer-term planning based on an adopted Asset Management Policy and Asset Management Strategy. Service managers will be involved in establishing maintenance, renewal, and upgrade requirements to ensure fitness-for-purpose.

The Financial Management team of Council will be engaged to ensure Asset Planning balances with Financial Plan requirements.

Connections and relationships

The Asset Plan will establish a strategic framework outlining the resources required and activities to be commissioned to ensure assets under Council’s stewardship are developed, renewed, or maintained to deliver the required service potential.

The Asset Plan and Financial Plan have a strong reciprocal relationship and must transparently recognise the interdependencies.

The Asset Plan will consider regional, state, and national plans and policies and the potential for regional partnerships and collaboration.

Whilst the mandated outlook for the Asset Plan is 10 or more years most councils should have in place asset management systems with a much longer outlook. This reflects the fact that many Council infrastructure assets have an exceptionally long lifecycle (50 years plus). These internal asset management systems must inform the Asset Plan.

Effective stewardship of assets assumes that assets exist to support the delivery of service outcomes to the community. Therefore, as a core part of its Asset Plan, Council should develop and adopt functional service level standards across all classes of assets. The Asset Plan should define these functional performance standards for each asset class/type, as well as the necessary investments that will be required to achieve this (i.e. maintenance, renewals, new investment).

The Asset Plan will be based on and clearly connected to the Financial Plan and underlying budgets and projections. Assumptions underpinning the Asset Plan should be transparent and linked to preparation of the Financial Plan, budgets, service standards, and major capital initiatives.

Implications

The Asset Plan has significant implications for:

The assumptions and financial modelling feeding into the Asset Plan should be transparent and consider the long-term implications of decisions by Council.

Council’s strategic risk register should link to the Asset Plan.

A word version of this information is found here.

Requirements

Council must prepare and adopt a budget for each financial year and the subsequent three financial years.

It is to be a ‘rolling’ Budget with an outlook of at least 4-years.

The Budget must:

  • give effect to the Council Plan
  • contain financial statements in the form required by the regulations (and accounting standards)
  • provide a general description of services and initiatives to be funded
  • identify major initiatives from the Council Plan that will be priorities for each financial year
  • for services funded in the budget, the prescribed indicators, and measures of service performance
  • total rate income and information on differential or fixed components of rates
  • a statement on whether Council intends to apply for an increase or variation to the rate cap
  • raising revenue through rates, fees and charges and external sources
  • allocation of resources to:
    • implement strategies and initiatives from the Council Plan (and Community Vision)
    • deliver services to determined quality and cost standards
    • maintain assets to policy and standards
  • how quality and cost standards for programs, services and assets provide good value to the community
  • a commitment to continuous improvement and achieving economic, social, and environmental sustainability
  • consideration of regional, state, and national plans and opportunities for collaboration and partnerships

The 4-year budget will outline how resources will be allocated across initiatives, programs, services, and capital works, as well as financing and debt redemption/servicing. It also provides a comprehensive outline of all income to be derived from rates, fees and charges, grants, and other revenue.

It should include both the ‘ongoing’ services and programs as well as the new strategies and initiatives flowing from the Council Plan.

Council must prepare and adopt a revised budget if rates are to be varied or to undertake borrowing not previously approved or to make material changes that should be the subject of community engagement.

Key dates

Adopt by 30 June each year or any other date fixed by the Minister.

Accountability and who is engaged?

The Council is responsible for developing, adopting, and maintaining a Budget.

The community must be consulted and involved in the development of the budget in a manner consistent with Council’s adopted community engagement policy.

The Executive is responsible for coordinating internal processes to prepare the Budget and making recommendations to Council for adoption.

The budget process requires significant coordination across Council areas (e.g. Finance, Asset Management, Capital Works, Service Managers etc) will be required to contribute to the development of the Budget.

Connections and relationships

The Budget is the principal means for:

Assumptions underpinning the Budget must be transparent and linked to preparation of individual service and program budgets, service standards and major initiatives (both operational and capital).

The Budget should demonstrate:

Implications

The Budget governs implementation of services, major initiatives and policy and strategy development.

The Budget is point at which Council must balance income and revenue with expenditure on services, programs, capital works, new initiatives and implementation of strategy whilst maintaining financial sustainability.

Council Plan initiatives should be clearly articulated in the Budget and have resources allocated to support effective implementation.

Financial and operational modelling feeding into the Budget should consider the long-term implications of decisions by Council.

Council’s strategic risk register should link to the Budget.

A word version of this information is found here.

Requirements

Council must prepare and adopt a Revenue and Rating Plan for a period of at least 4 financial years.

Key dates

Adopt by 30 June after a general election.

Accountability and who is engaged?

The Council is responsible for adopting the Revenue and Rating Plan.

The Executive is responsible for coordinating internal processes to prepare the Revenue and Rating Plan and making recommendations to Council for adoption.

Connections and relationships

The Revenue and Rating Plan is a new requirement. It is for a 4-year ‘block’ period starting on 30 June in the year after each general election.

It provides a medium-term plan for how Council will generate income to deliver on the Council Plan, program and services and capital works commitments over a 4-year period. It defines the revenue and rating ‘envelope’ within which Council propose to operate.

It will incorporate consideration of:

  • how revenue will be generated through rates on properties (including differential rates [if any] on different property classes)
  • fixed service charges that might be applied on services such as waste or recycling
  • fees and charges for services and programs – including cost recovery policies, user charges and means testing
  • developer contributions and other revenue
  • revenue generated from use or allocation of Council assets (including the application of discounts and waivers)
  • recurrent and non-recurrent operational and capital grants from other levels of government
  • entrepreneurial, business, or collaborative activities established to deliver programs or services and generate income or reduce costs

Assumptions underpinning the Budget must be transparent and linked to preparation of individual service and program budgets, service standards and major initiatives (both operational and capital).

The Revenue and Rating Plan therefore what each source of revenue is, how much income will be raised in each class, and the policy rationale/assumptions for each, to fund required the proposed expenditure included in the 4-year budget.

Implications

The Revenue and Rating Plan outlines the assumptions, policy, and decisions of Council in relation to generating the required income to effectively support implementation of the Council Plan and budget for a 4-year period.

The plan will include transparent consideration of the policy objectives and social, economic, and environmental benefit delivered through subsidies, waivers, and discounts.

It will identify financial and revenue related risks and ensure these are mitigated and effectively managed.

The Revenue and Rating Plan will be underpinned by policies that provide stability and predictability.

Council’s strategic risk register should link to the Rating and Revenue Plan.

A word version of this information is found here.


Requirements

Council must prepare an annual report in respect of each financial year.

The annual report must contain:

  • a report of operations of the Council
    • statement of progress on implementation of the Council Plan (including strategic indicators)
    • statement of progress in relation to major initiatives identified in the budget
    • prescribed indicators, measures, and results achieved
  • audited performance statement
    • prescribed indicators, measures, and results achieved of service performance
    • prescribed indicators, measures, and results achieved of financial performance
    • prescribed indicators, measures, and results of sustainable capacity performance
  • audited financial statements
  • copy of the auditor’s report on the performance and financial statements
  • reviewing and adopting in-principle the performance statement and financial statement for the previous financial year
  • nominating two Councillors to sign the audited statements
  • holding a Council meeting at which the Mayor will report on implementation of the Council Plan and present the Annual Report
  • coordinating internal processes to prepare the Performance and Financial Statement
  • preparing mandated information on implementation of the Council Plan and major initiatives, and
  • making recommendations to Council for adoption.

Key dates

The 2020-21 financial year Annual Report still falls under the previous regulations and needs to be submitted to LGV by 30 November 2021 (then adopted by Council within 28 days of submission).

As soon as practicable after the end of the financial year Council must resolve in-principle to adopt (for the purpose of audit) the performance statement and financial statement for the previous financial year.

The auditor will conduct the audit (and may recommend changes) prior to the final statements being certified (signed by two councillors or other person as prescribed by regulation).

The auditor will provide the Minister with a copy of the audit report and audited statements.

The Mayor must report on the implementation of the Council Plan by presenting the Annual Report to a Council meeting open to the public within 4 months of the end of the financial year (or if in an election year, the day before election day).

Accountability and who is engaged?

The Council is responsible for:

The Executive is responsible for:

Connections and relationships

The Annual Report outlines the Council’s performance for the year as measured against the Council Plan and Budget.

Achievements for the year are outlined in a report of operations, this includes service performance indicator results, achievement of major initiatives and a governance and management checklist.

The Annual Report also must include financial statements and performance statement to report against service performance, financial performance, and sustainability indicators.

The Annual Report is a retrospective view of performance against what council stated that it would do, it presents an integrated perspective of performance and achievements and is a critical mechanism to support transparency and accountability.

It links closely with and informs the Local Government Performance Reporting Framework that provides a longitudinal view of performance over time.

The Annual Report is about celebration of success and achievement but also understanding challenges and learning from failures. Demonstrating how learning from the process informs future planning and execution is an important element of accountability.

Many councils go beyond statutory requirements and integrate other reporting such as Public Health and Wellbeing into the annual report framework.

Implications

The Annual Report is a key mechanism to support accountability and transparency to the community and other stakeholders.

It must take an integrated approach and clearly articulate and follow linkages between the Community Vision, Council Plan, the Budget and other major initiatives, strategies, and plans.

The Annual Report must go beyond simply reporting on performance and progress towards supporting continuous improvement and change in how Council plans and delivers outcomes for its community.

A word version of this information is found here.

Requirements

The Chief Executive Officer is responsible for establishing and maintaining an organisation structure for the Council and is also responsible for all staffing matters, including appointing, directing, managing and dismissing members of Council staff under s46(3)(a) and (b).

Under s 46(4) the Chief Executive Officer must develop and maintain a workforce plan that:

  • describes the organisational structure of the Council
  • specifies the projected staffing requirements for a period of at least 4-years, and
  • sets out measures to seek to ensure gender equality, diversity, and inclusiveness.
  • development and maintenance of a Workforce Plan
  • ensuring that requirements related to diversity and gender equity are given effect and meet any additional regulatory requirements
  • the human resources required to implement strategic objectives, strategies, and major initiatives of the Council Plan
  • the workforce requirements outlined in the 4-year Council budget
  • the way in which policy objectives established for gender equity and inclusiveness will be achieved
  • any other requirements prescribed by regulations
  • gender equity, diversity, and inclusiveness policy objectives for the Council
  • defining what ‘will affect the capacity of the Council to deliver the Council Plan’ means
  • establishing thresholds for notification of a restructure to the Mayor, Deputy Mayor, Councillors, and initiation of consultation with staff?
  • how transparency provisions related to the Workforce Plan will work whilst protecting the individual privacy and workplace rights of employees?
  • how this provision works or integrates with industrial obligations under relevant awards or enterprise agreements

Under these provisions the Chief Executive Officer must also inform the Council and consult members of Council staff affected before implementing an organisational restructure that will affect the capacity of the Council to deliver the Council Plan.

The Mayor, Councillors and members of Council Staff must have access to the workforce plan.

Key dates

The Chief Executive Officer must develop the first workforce plan within 6 months of the commencement of s 46, which is 31 December 2021.

It is not mandated that the Plan be adopted, only that 'the Mayor, Deputy Mayor, Councillors and members of Council staff have access to the workforce plan.'

Accountability and who is engaged?

The Chief Executive Officer is wholly responsible for:

Council is informed when the Chief Executive wishes to implement an organisational restructure that will affect the capacity of the Council to deliver the Council Plan.

Council staff affected by any proposed restructure will be engaged prior to implementation.

Connections and relationships

Employee related costs are usually the largest single cost category for Councils and therefore the Workforce Plan should reflect:

Implications

The requirement to establish a Workforce Plan will require a Chief Executive (and potentially Council) to consider and determine on the following matters:

Implementing Deliberative Engagement for Council’s Strategic Planning and Reporting Framework

LGV delivered a short course for CEO’s between 10 – 12 November.

The course covered the following:

  • The critical role for CEO & Executive in guiding and providing advice to the new Council
  • Creating internal culture and pre-conditions for integration and coordination
  • Leading and embedding Integrated Strategic Planning and Reporting Framework

The resources from these sessions below, provide information on the principles that underpin deliberation, how deliberation is different to standard engagement and the types of activities/techniques that could be considered deliberative practice including case studies.

Councillor Induction Material

Co-design Process

The co-design process ran from August to October 2020 with participation from the sector. The purpose, context, timelines and process are shown here.

To inform this process, a discussion paper was developed that included a draft model framework to illustrate how various strategic plans could be integrated.

In developing this discussion paper and draft framework, Local Government Victoria was conscious of the varying scale of operations across metropolitan, regional, and rural councils and therefore was not looking to mandate a ‘one size fits all’ approach.

It is anticipated that councils will adopt a ‘continuous improvement’ approach to implementation and that the framework will evolve over a reasonable time. Implementation and application of the framework within individual councils will depend on the size of the council, available resources, and capability as well as the sophistication of pre- existing and reporting processes.

The overarching question (remit) posed to participants in the codesign process was:

How do we make strategic planning and reporting more integrated so that it works better for councils and their communities?

The purpose of the co-design is twofold:

  • to consider and improve the draft framework as one of the key supports
  • to identify all other ‘supports’ needed by councils.

The intent is to add value and build on the current planning and reporting approaches and expertise of councils, not to replace the work of councils.

Supports’ in this context covers a range of elements such as guidance materials, regulations, models, training courses, or communities of practice. There is no set limit to this range of items that can be considered ‘supports’. Supports may be related to the overall framework or to specific individual elements of the framework (community vision, council plan, financial plan, asset management plan, budget, revenue and rating plan, annual report, workforce plan).

Once identified, some ‘supports’ may best be provided by Local Government Victoria, while other ‘supports’ may be best developed by peak bodies or groups of councils working together.

The final outputs of the co-design process will be:

  • An integrated strategic planning and reporting framework that can be tailored by individual councils to suit their own needs
  • A range of ‘supports’ identified through the co-design that are developed to support councils to undertake integrated strategic planning and reporting

You can find more information about the objectives, process and outcomes of the co-design in the Engagement Plan.

Timeline of the Process

Co-design Roadmap

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