ASSET MANAGEMENT POLICY

EFFECTIVE DATE Adopted by Council on December 2017

REVIEW DATE Review by December 2021

AUDIENCE External

AUTHOR Executive Officer Strategic Asset Management

DIRECTORATE Environment & Engineering

Version Control

Version: 2017-1.0

Approved by Council: 28 November 2017

Responsible Officer: Executive Officer Strategic Asset Management

Contact Officer: Strategic Assets Planner

Revision History

Version Date Summary of revisions

2009 - 1.0 2009 Asset Management Policy (Original)

2012 - 1.0 August 2012 Last policy update endorsed by Council. The policy was updated to include key roles, and stronger links to corporate priorities, coordination and continual improvement strategies of the organisation

2017 -1.0 November 2017 Minor amendments and edits to reflect current corporate structures and add clarity. Adapted to current Council policy format.

Policy tabled and adopted at Council.

Approval, effective and review dates updated to reflect adoption.

Page 2 of 9

Table of Contents

1 Introduction.............................................................................................................4

1.1 Context............................................................................................................4

1.2 Purpose...........................................................................................................4

2 Scope.....................................................................................................................4

3 Relationship with The Council Plan 2017-21..........................................................4

3.1 Strategic Context.............................................................................................5

3.1.1 Strategic Asset Management Plan..........................................................5

3.1.2 Asset Management Plans........................................................................6

3.2 Legislative Context..........................................................................................6

3.2.1 Local Government Act.............................................................................6

3.2.2 Road Management Act............................................................................6

4 Policy Statement.....................................................................................................6

5 Asset Management Relationships and Responsibilities.........................................7

6 Definitions...............................................................................................................8

Page 3 of 9

1 Introduction 1.1 ContextYarra Ranges Council is responsible for over $1 billion of infrastructure assets that underpin the delivery of services to the community.

As custodian and steward of these community’s assets, Council ensures that these assets are effectively managed so they continue to meet the needs of the community whilst achieving best value and sustainable outcomes.

Asset management is a core Council service and is at the centre of Council’s overall financial and strategic planning decision making.

Together with the Strategic Asset Management Plan, individual Asset Management Plans and associated working procedures and practices it provides a comprehensive, accountable and transparent Asset Management Framework for the Council.

1.2 PurposeThe purpose of this policy is to ensure asset related decisions are aligned with community expectations and service needs in a sustainable manner and acts to moderate the risk of improperly managed assets.

2 ScopeThis policy provides an overarching framework for the procedures, processes, systems and asset information required to manage all of Council’s existing and future physical assets efficiently and effectively.

This policy will apply to Council’s major asset portfolios including infrastructure, ICT and fleet, Council and Council staff and supports participative decision making by the community.

3 Relationship with the Council Plan 2017-21.Stewardship of its assets is a core function of Council. In the Council Plan, Council has recognised that one of the key criteria of a sustainable organisation is long term asset and financial management.

Sound strategic asset management is fundamental to providing infrastructure and assets that support Council’s services in a sustainable manner over the long term. As such it has an underpinning role in ensuring council achieves its Key Strategic Objectives.

Page 4 of 9

Strategic asset management is the discipline of how a High Performing Organisation identifies current and future needs from community stories and translates these into Quality Infrastructure and Liveable Places that support Connected and Healthy Communities, Vibrant Economy, Agriculture and Tourism and a Protected and Enhanced Natural Environment. In a manner that considers value for money and sustainability of the whole asset portfolio and thereby the organisation over the long term.

3.1 Strategic ContextThis policy is the overarching document in Council’s broader Asset Management Framework which also includes the Strategic Asset Management Plan and Asset Management Plans. Its relationship to these documents is summarised below:

3.1.1 Strategic Asset Management Plan

The Strategic Asset Management (AM) Plan underpins and supports the policy through outlining actions to be undertaken in order to improve AM capability and meet the AM Policy’s goals.

Page 5 of 9

3.1.2 Asset Management Plans

The Asset Management Plans are based on an assessment of each significant asset portfolio and detail the activities, expenditure forecasts and risks associated with providing the assets to a defined level of service.

3.2 Legislative Context

3.2.1 Local Government Act

The Local Government Act 1989 (“Act”) sets out the role, purpose, responsibilities and powers of local governments, including the provision of significant long life infrastructure.

The Act identifies the Council Plan as Council’s principle strategic document, which includes Council’s long term strategic objectives and vision for the future. The Council Plan is further supported by a long term financial plan and asset management plans to help ensure sustainable service delivery.

3.2.2 Road Management Act

The Road Management Act 2004 requires Council to prepare a Road Management Plan which specifies an affordable level of service. Strategic asset management helps determine the affordability of various service levels and the successful implementation of the Road Management Plan is supported by sound tactical asset management planning and operations.

4 Policy StatementSound asset management is necessary to enable the Council to meet its responsibilities by:

Planning to provide services to current and future generations within the community

Encouraging and supporting the economic, environmental and social development of the municipality

Providing quality community infrastructure

Developing assets that are responsive to the changing environment in which we live.

This policy is significant because asset management needs to be considered to ensure:

Corporate responsibility and appropriate resources are identified

Management of assets is undertaken in a structured and co-ordinated way

Risk management is a key consideration

Financial, social and environmental sustainability

Continuous improvement and seeking innovative ways of meeting service requirements are actively pursued

Legislative and regulatory requirements are met.

Page 6 of 9

5 Asset Management Relationships and Responsibilities

The key to successful and sustainable asset management in Local Government is the strength and clarity of core roles within the organisation.

CouncilIn its role of stewardship of assets Council will embrace asset management by:

Endorsing the approach for the strategic management of Council assets

Endorsing the definition of levels of service for all business areas that will best balance community aspirations and financial sustainability.

Chief Executive OfficerTo act as principal advocate for asset management in the Council by ensuring:

The development of a long term strategic asset management focus within Council

There is promotion of community involvement in asset development and management

There is monitoring and reviewing the Council’s performance in managing its assets and promotion of continual improvement in place across the organisation

The development of cross organisational awareness and responsibilities for asset management

Legislative obligations and regulations are met.

Director Environment & EngineeringTo act as Council’s sponsor for asset management through:

Taking primary responsibility to monitor, promote and align resources to strategic asset management improvements

Allocating resources to manage functions associated with strategic asset management for the organisation

Implementing strategic improvement processes and the development of cross organisational responsibilities

Building commitment to best appropriate practice in asset management

Ensuring that the appropriate training programs and supporting tools are made available to both Council and Council officers.

Strategic Asset Management Control Group (SAMCG)Responsible for major decisions and direction of Strategic Asset Management practice around Asset Management priorities within Council.

Page 7 of 9

Managers and Executive Officers (Asset Managers)The role of senior staff and asset managers in relation to assets is to:

Acknowledge and take responsibility for their role in asset management

Maintain skilled and experienced staff and provide training when needed

Develop strategies and plans for all asset categories

Implement asset management improvement plans

Ensure timely and accurate management and reporting of asset inventory

Monitor and report on asset management performance

Ensure that all assets have an appropriate asset owner

Create, renew and dispose of assets to serve both current and future community needs.

The Executive Officer of Strategic Asset Management has a lead role in supporting and facilitating the discharge of these roles and responsibilities.

6 DefinitionsAsset Management

The systematic and coordinated activities and practices through which Council optimally manages its physical assets and their associated performance, risks and expenditure over their lifecycle for the purpose of achieving its Council Plan.

Asset Management Plan

A tactical plan developed for the management of a class of assets that combines multi-disciplinary management techniques (including technical and financial) over the lifecycle of an asset in the most cost-effective manner, to provide a specific level of service. A significant component of the plan is the development of long term expenditure forecasts for the activities required to manage the assets.

Asset Management Strategy

A high level strategic plan that documents the relationship between the organisational objectives and the asset management objectives, defines the framework required to achieve the asset management objectives and should be used to develop the asset management plans.

Current industry practise refers to this document as a Strategic Asset Management Plan.

Council Yarra Ranges Council

Page 8 of 9

Council Plan Council’s key planning document for the four year electoral term and describes the things that Council stands for, organisational objectives, the main activities to be completed and how these activities are going to be resourced. Importantly, it also explains how performance will be measured and reported through the Annual Report and other performance reports.

Level of Service An attribute of service (e.g. quantity, quality, availability or accessibility, etc) against which service performance can be targeted and measured.

Lifecycle The cycle of activities that an asset goes through during its life, i.e. planning, design, construction/acquisition, operation, maintenance, renewal, upgrades and/or disposal.

Long Term Financial Plan

The Long Term Financial Plan is the key financial planning document of Council which is governed by a series of financial strategies and accompanying performance indicators that Council considers and adopts. It establishes the financial framework upon which sound financial decisions are made.

Page 9 of 9