Ararat Rural City Council: Asset management strategies improvement needed

ARARAT Rural City Council chief executive Andrew Evans believes Victoria’s municipal councils need to improve their asset management strategies.

“We all endeavour to do the best we can within the constraints of our resources,” he said.

“But I think local government does have a fair way to go in terms of asset management.

“There are some difficult questions we need to ask ourselves on behalf of our communities.”

His comments follow Victorian Auditor-General John Doyle’s report on asset management and maintenance by councils.

Ararat was one of five municipal councils audited as part of the study.

It was selected to represent small rural councils.

Other municipalities audited included Kingston City Council, Port Phillip City Council, Cardinia Shire Council and Wodonga City Council.

The Auditor-General’s findings were released on Wednesday.

Mr Doyle acknowledged councils statewide had made efforts to improve their asset management practices. But, he said, progress had been slow.

“This is despite warnings as early as 1998 that Victoria’s councils needed to improve their asset management practices and address growing asset renewal gaps,” he said.

Mr Doyle described asset renewal gap as the difference between the amount of money councils needed to renew their assets, compared with the sum allocated to the purpose.

“Since 1998, asset renewal gaps have almost doubled,” he said.

“The audited councils are generally budgeting less than is required to renew their assets and the funding needed for asset renewal continues to grow each year.”

Mr Doyle feared council assets would become more difficult and costly to maintain over time.

He said the services which used the infrastructure could subsequently become less sustainable.

The report proposed six recommendations for Local Government Victoria and seven for councils to improve their practices.

As a priority, Mr Doyle suggested councils develop a strategy for more effectively reducing their asset renewal gaps.

Mr Evans said the report was fair and accurately described the challenges councils were facing throughout the state.

He said Ararat Rural City Council had been working on asset management before the audit.

“We’re one of the few councils audited which has managed to claw some of that back in the past couple of years,” he said.

“And we are continuing to address those issues.”

Mr Evans said council had struggled to attract and retain suitably qualified and skilled asset managers for several years.

But two new staff had since been employed and council had a new asset management leadership team.

“Ararat Rural City Council is making good progress towards rebuilding our asset management systems,” Mr Evans said.

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