Agenda Riverina Joint Organisation Board Meeting Thursday, 27 February, 2020 1.45p.m. Venue: Macquarie Room, NSW Parliament House, Macquarie St, Sydney
Agenda 1. Apologies ...... 2 2. Move to Committee of the Whole ...... 2 3. Declarations of Interest ...... 2 4. Confirmation of Minutes of the Previous Meeting ...... 2 5. Business Arising from Previous Board Meetings ...... 2 6. Correspondence ...... 3 7. Chief Executive Officer Report ...... 3 9.1 JO Funding Arrangements ...... 3 9.2 JO Regional Planning ...... 3 9.3 JO Working Party Meetings ...... 3 9.4 JO Core Activities – Advocacy and Lobbying ...... 4 9.5 JO Core Activities – Intergovernmental Co-operation ...... 7 10. JO Chairs’ Forum ...... 7 11. Review of the JO and REROC Operations ...... 9 12. Finance Report ...... 9 13. Urgent Business without Notice ...... 9 14. Resolution to Move out of Committee of the Whole ...... 9 15. Next Board Meeting ...... 9
Riverina JO Board Agenda and Papers 1 February 2020 1. Apologies The Chief Executive Officer to advise the meeting of apologies.
Recommendation: That the Board receive the apologies.
2. Move to Committee of the Whole The JO Board may conduct its business as a Committee of the Whole. The JO Board is required to move a motion to that effect at the commencement of the meeting and to move a resolution at the end of the meeting to come out of Committee of the Whole.
Recommendation That the Board move a motion to conduct its business as a Committee of the Whole.
3. Declarations of Interest Board Members and senior staff of the JO are required to declare any interests in relation to matters on the agenda.
4. Confirmation of Minutes of the Previous Meeting The Board to confirm the minutes of the 12 December 2019 Board meeting.
Recommendation: That the minutes of the 12 December 2019 Board meeting be confirmed as a true and accurate record.
5. Business Arising from Previous Board Meetings Outstanding matters: • SSWP Regional Water Plan – letter sent to Michael Blackmore advising that the JO will not be pursuing the funding opportunity. • Letter to the Premier re ESL Increase – remains outstanding. • Letter to IPART re inclusion of ESL and LG Elections in the Calculation of the LGCI – letter sent. • Preparation of Response to the Audit Risk and Improvement Discussion Paper – response prepared and lodged. • Letter to Hon Michael McCormack MP re Differential Medicare Rebate for Rural Doctors based on PHARIA Scale – remains outstanding. • Letter to the Deputy Premier re State funding for Rural Financial Counselling Services – this has not been sent yet. There has been a substantial injection of funding in to the RFCS as a result of bushfires. We need to clarify that commitment before we request additional funds.
Other matters are dealt with in Reports
Recommendation That the Board note progress on matters arising.
Riverina JO Board Agenda and Papers 2 February 2020 6. Correspondence The inwards and outwards correspondence is listed in Attachment One.
Recommendation That the Board receive and note the Correspondence.
7. Chief Executive Officer Report
9.1 JO Funding Arrangements
JO Capacity Building Funding – the JO has received advice that the funding has been approved and that a contract is being prepared. The three projects are outlined in Attachment Two. It is my understanding that the delivery time for the projects will remain at 12 months.
The implementation of the projects will be guided by the JO’s Operations’ Working Party, who were central to the development of the projects that have been funded. Once the contracts are in place we can commence the delivery of the projects.
As previously discussed the Addressing Skills Shortages in Local Government project will have a Steering Committee drawn from the Workforce Development Group. In addition, last year I spoke with Jennifer James from LGNSW about the project and she was keen to be involved. Once we have the contract in place we will call a meeting of the Group and I would like to involve Jenny as well.
At this stage we have not received advice on when the Funding Deed will be provided, however, given that no changes have been requested to the original application, I am recommending that the Board move that once the Deed is provided that it be executed.
Recommendation The Board resolves that the CEO execute the Deed for the Capacity Building Funding, providing there are no material changes to the three projects that were proposed.
There have been no further discussions in relation to the provision of core funding for Joint Organisations, however this is the primary task that has been given to the JO Chairs’ Advisory Group in their discussions with the Minister.
9.2 JO Regional Planning Freight Transport Plan – The Regional Freight Transport Plan has been finalised. Copies of the Plan were provided to the Federal Government representatives at the Roads of Strategic Importance (ROSI) consultation.
9.3 JO Working Party Meetings
Operations Working Party Met on 12 February. The Group Discussed the following:
Riverina JO Board Agenda and Papers 3 February 2020 • JO Capacity Building Fund • JO Audit Costs • Regional Road Transfer Terms of Reference • JO Advisory Committee Draft Report to the Minister • Best Practice in Aggregated Procurement project • Drought Committee • Regional Freight Transport Plan • Consultation on Roads of Strategic Importance (ROSI)
Governance Working Party Met on 12 February. The Group discussed: • Regional Road Transfer Terms of Reference • JO Advisory Committee Draft Report to the Minister • NSW Small Business Strategy Discussion Paper (Attachment Three) and are recommending that the Riverina JO lodges a response to the Paper. Comments on the paper are due by 4 March • Audit Risk and Improvement Committee Discussion Paper • JO/REROC Review
9.4 JO Core Activities – Advocacy and Lobbying 1. Meetings with Politicians – we met with Shadow Minister, Greg Warren MP in Wagga Wagga on 19 February. The meeting was arranged by the Shadow Minister’s office, and coincided with a Shadow Cabinet meeting in Tumut. Cr Seymour, Tony Donoghue and myself attended the meeting where we discussed all the matters we have been advocating on. The Shadow Minister receives copies of all our advocacy correspondence and submissions.
2. Section 7.12 Contributions for State Significant Developments – as resolved at the last meeting we have written to the Deputy Premier requesting a meeting to discuss the issue. We are yet to receive a response.
Cr Firman and I have had a teleconference with Cr Linda Scott and the LGNSW advocacy staff in relation to the matter and she agreed to follow-up with the Minister. During the meeting Cr Scott raised concerns that generally when it comes to State Significant Developments that the State does not appear to consider local planning regulations at all. In subsequent contact, Cr Scott has advised that they are still seeking a meeting with the Minister.
We have placed this issue on the list of issues that the JO would like the Minister to address when he meets with us at Parliament House on 27 February.
We also raised the issue with the Shadow Minister when he met with us on 19 February.
Recommendation That the RivJO write to the Deputy Premier to request a meeting with him to discuss the matter.
3. Audit, Risk and Improvement Framework – our response was prepared on the Framework (Attachment Four) and lodged prior to the Christmas break. There was a lot of consultation with the membership and this is reflected in the Response. The Response has also been circulated to the other JOs for their information. We appear to be the only JO that addressed
Riverina JO Board Agenda and Papers 4 February 2020 the impact on the Member Councils as well as on the JO itself. It is my understanding that all JOs oppose the application of the Framework to JO operations.
In our last meeting with Cr Scott, this issue was raised. We have now provided a copy of the response to LGNSW.
The issue was also raised with Greg Warren during his visit.
Recommendation Riverina JO formally adopt the response to the proposed Audit, Risk and Improvement Framework for Local Government.
4. Drought Sub-committee – this Committee has met twice since the December Board meeting. The number of meetings reflects the Committee’s desire to get its first project, the promotion of the Family Household Allowance (FHA) underway by Australia Day.
The uptake of the FHA in the Riverina JO region is low and the Committee has spent some time trying to identify the barriers to entry. Representatives from Centrelink, who are involved in the management of the payments attended the December 19 meeting and following that it was agreed to push the positive aspects of receiving the payment and to adopt the following tagline: “it’s good for you, it’s good for your family, it’s good for the community”
A number of members expressed a desire to get materials distributed at Australia Day events, so RFCS pulled out all the stops and designed materials, which I reviewed and then drafts were sent to the Committee, by mid-January everything was at the printers and we had 10,000 flyers and 100 posters to distribute before Australia Day. Copies of the materials will be distributed at the Board meeting. Councils received hard copies and soft copies of the materials, in addition the RFCS prepared social media tiles and narratives for use by councils. The brochures are being distributed through council offices, libraries, agricultural businesses, Land Care and Greater Hume had the brochures printed and inserted in the rural rate notices.
We were able to organise a hard launch for the project for 21 February with the Deputy Prime Minister and Member for Riverina, Hon Michael McCormack, in Temora, but this had to be cancelled following the train crash in Victoria which required the Deputy Prime Minister’s attention. The Deputy Prime Minister’s office has been able to re-schedule and the launch will now be held on March 9 at 1.00p.m. at Temora Shire Council Chambers
Our last meeting considered how bushfire relief was being built into drought relief programs and we will continue to look at this.
The next meeting of the Committee will focus on developing a standard template for an Adverse Events Plan. All councils that received the second round of the $1 million drought grants are required to produce one of these plans. There is a lot of confusion about what it should contain. I have had discussions with the funding body and received some direction, which we will take into account in the development of the template.
The Committee will now also being looking at how to support the promotion of the mental health and welfare programs that are being delivered by the Primary Health Network and the Local Health District (LHD). We have also agreed to invite someone from the LHD onto the Committee.
Riverina JO Board Agenda and Papers 5 February 2020
The next meeting of the Committee will be held in Temora on 9 March at 10.00a.m.
5. LGNSW/JO Working Group – there have been no further meetings called for this Group.
6. Impact of Rising Costs – a letter has been sent to IPART about this issue (Attachment Five). Copies were sent to local members, the Minister, the Deputy Premier and LGNSW. A teleconference with Cr Scott and the LGNSW advocacy team was held on 19 February, LGNSW advised that they were pleased they had real numbers to work with and Cr Scott said they would look to take the matter up with IPART.
7. Regional Roads Transfer Terms of Reference for the Independent Panel – we prepared and lodged a response and also provided a copy of the response to the other JOs and to LGNSW. (Attachment Six)
Recommendation Riverina JO formally adopt the response to the Regional Roads Transfer Terms of Reference for the Independent Panel.
8. Mobile Black Spot Funding – we have not received any further updates to the information in Attachment Seven, so this will now be sent to the Federal Minister for Communications and our local Federal Members.
9. Mining Legislation– this paper has not yet been completed.
10. Up to 3% Increase in the Rate Peg without a Special Rate Variation – this issue was discussed with Cr Scott and the LGNSW Advocacy Team on 19 February. We discussed the problem that the rate peg does not factor in the expansion, enhancement or introduction of services for residents, or the implementation of the Community Strategic Plan, LGNSW are advocating for 2%. It would be appropriate for our advocacy on the issue to align with the LGNSW one, therefore I am recommending the Riverina JO’s stance on this issue be amended.
Recommendation That the RivJO resolve to advocate for a 2% increase in the Rate Peg without requiring a Special Rate Variation.
11. Proposed Export Waste Ban – Craig Salan the Manager of Kurrajong Recycling addressed the last meeting of the REROC Waste Forum about how the introduction of the Ban is affecting Kurrajong’s operations. He advised that the announcement of the Ban has resulted in overseas markets for product already drying up, because Australian suppliers are not in a position to provide long term contracts. He further advised that prices for product like cardboard has dropped significantly because there are only two buyers in the Australian market, Visy and Amcor.
12. Visit to NSW Parliament House – arrangements are being finalised for this meeting. The Ministers that will be attending are: . Minister for Local Government: Hon Shelley Hancock MP
Riverina JO Board Agenda and Papers 6 February 2020 . Minister for Regional Roads: Hon Paul Toole MP . Minister for Health: Hon Brad Hazzard MP . Minister for Agriculture: Hon Adam Marshall MP . Minister for Planning: Hon Rob Stokes MP . Minister for Mental Health, Regional Youth and Women: Hon Bronnie Taylor MLC . Minister for Skills and Tertiary Education: Hon Dr Geoff Lee MP . Minister for Water: Hon Melinda Pavey MP
Steph Cooke will be welcoming the Board and representing the Deputy Premier who is an apology. A dinner has been arranged for the night before, which will be attended by Cr Linda Scott and Dr Joe McGirr, Member for Wagga Wagga. All the local members were invited to attend dinner and/or lunch, Steph and Justin Clancy, Member for Albury declined dinner but have said they will attend lunch.
9.5 JO Core Activities – Intergovernmental Co-operation The following activities have occurred in this Core Activity:
- Consultation with the Federal Department of Infrastructure on Roads of Strategic Importance (ROSI) – this consultation was held on 14 February in Narrandera. While the focus was on the Newell Highway we were able to present on all the roads that we have identified in our Freight Transport Plan as having constraints on the effective movement of freight transport in our Region. Cr Firman co-hosted with Cr Mack and all the Members that attended were also able to speak to issues in their LGA. We placed some emphasis on the need for attention to the roads that feed into the Newell.
- Riverina-Murray Drought Task Group – the most recent meeting of this Group was held on 12 February. The FHA promotional materials produced by the JO’s Drought Committee were distributed to the agencies present. We are also providing softcopies for them to use wherever they can. The success of the promotion was noted.
- Meetings with Murrumbidgee Primary Health District – the most recent meeting was held on 10 February. The meetings discuss primarily the drought response in the region and now of course the bushfire responses.
- Riverina Murray Regional Leadership Executive – the next meeting of the Leadership Executive is scheduled for 25 February. These meetings fall within James Bolton’s responsibilities, in addition to these meetings, James and I speak on a regular basis.
- Murrumbidgee Suicide Prevention and Postvention Group, Murrumbidgee Primary Health Network – I participated in the launch of the Network and signed the Statement of Commitment on behalf of the JO as resolved at the December Board meeting.
Recommendation: The Board receive the CEO’s Report
10. JO Chairs’ Forum Agreement on the Definition of Financial Sustainability for a JO – the JO Chairs’ Forum has formed a smaller Advisory Committee on financial sustainability, the Taskforce whose representatives are
Riverina JO Board Agenda and Papers 7 February 2020 from Namoi Unlimited, Illawarra JO, NEJO and CRJO meets with the Minister to discuss the on-going issue of financial sustainability. The formation of the Advisory Committee was one of outcomes of the letter sent to the Minister on 31 May 2019 by the 13 Chairs alerting the Minister to the problem of financial sustainability for JOs. The Advisory Committee have been preparing a position paper for the Minister and want all JOs to resolve to adopt a definition for sustainability which is as follows:
“A Joint Organisation will be financially sustainable over the long term when it is able to achieve sufficient funding and deliver on the Strategic Regional Priorities agreed with its members and stakeholders”
Recommendation That the Board of the Riverina JO resolves to agree that the definition of Financial Sustainability, for the purpose of the Advisory Committee be determined as “ a Joint Organisation will be financially sustainable over the long term when it is able to achieve sufficient funding and deliver on the Strategic Regional Priorities agreed with its members and stakeholders
Advisory Committee Paper on Financial Viability – this Paper was prepared by the Advisory Committee and circulated to JOs for comment. There were a number of concerns the Riverina JO had, particularly with regard to the apparent push for JOs to take on compliance and regulatory activities from the OLG. We have sought clarification from the Advisory Committee about what was actually meant. I circulated our final comments to the Board and to the Advisory Committee. We have requested that a final version be presented to the JO Chairs’ Forum before it is given to the Minister as a JO position. As all JOs are now starting budgets for the next Financial Year, addressing this issue has become a matter of urgency.
Terms of Reference for the Joint Chairs’ Forum – Members will recall that the ToR for the Joint Chairs’ Forum (Attachment Eight) required an amendment that allowed for the election of a Chair and a Deputy Chair. There appears to be some confusion about how the mechanics of this were to work. In order to facilitate the resolution of the issue I am proposing that the JO Board adopt a resolution that will provide broad support for the required amendment. Cr Firman can then take the resolution to the next meeting of the JO Chairs when the matter comes up for discussion.
Recommendation That the Board of the Riverina JO resolves to approve an amendment to the Joint Chairs’ Forum’s Terms of Reference to allow for the election of a Chair and Deputy Chair for a period of 12 months.
The next meeting of the Chairs’ Forum is scheduled for Thursday 5 March 2020. Speaking at the meeting are: - Hon Melinda Pavey MP - Hon Adnrew Constance MP - Hon Shelley Hancock MP There will also be presentations by the Mr Aaron Green, Assistance Auditor General and Dr Suzanne Pierce on the circular economy and the impacts of waste.
This meeting will be preceded by a meeting of the JO Executive Officers.
Riverina JO Board Agenda and Papers 8 February 2020
Recommendation That the Board receive the Report.
11. Review of the JO and REROC Operations This is currently underway. The consultants have sent surveys out and met with the Board. Greg Smith is staying in close contact with Cr Firman on the progress of the Review.
12. Finance Report
The Financial Report is attached (Attachment Nine) for the Board’s consideration.
The JO now needs to commence preparing its budget for 20/21 Financial Year. The Treasurer and I will commence work on the budget and then this will go to the Operations Working Group for discussion. It is likely that we will need to create more than one budget as we don’t actually know what the structure will be for the JO moving forward.
Audit 19/20 – we received the account for the audit, and despite the Auditor-General’s assurance that the $7,500 (plus GST) was only an estimate and that the cost could fall or rise depending on complexity, the JO was billed exactly $7,500 (plus GST). I have made several phone calls to arrange a meeting with Mr Aaron Green, as we were invited to do in his previous correspondence on this issue. I have not yet been successful. I am continuing to follow this up, however he is scheduled to speak at the next JO Chairs’ Forum where the cost of the audits will be raised by all the JOs as there is universal agreement that the cost did not reflect the level of work required.
Recommendation: That the Board receive the Finance Report.
13. Urgent Business without Notice This item allows Board Members to raise any urgent issues for consideration, discussion and where appropriate action.
14. Resolution to Move out of Committee of the Whole The JO Board may conduct its business as a Committee of the Whole. The JO Board is required to move a motion to that effect at the commencement of the meeting and must move a resolution to come out of the Committee of the Whole.
Recommendation That the Board move a motion to move out of Committee of the Whole.
15. Next Board Meeting The Board of the Riverina JO will next meet on Thursday April 23, 2020 at 9.00a.m.
Riverina JO Board Agenda and Papers 9 February 2020 ATTACHMENT ONE
Riverina JO Correspondence List 12 December 2019 – 24 February 2020
INCOMING
Date Content Action Received
29 January 2020 Ms Steph Cooke MP, Parliamentary Secretary to the Deputy Premier, Member for Cootamundra – Noted responding to correspondence in relation to the RivJO’s response to the State Governments discussion paper on a New Risk Management and Internal Audit Framework for Local Government 12 February 2020 Hon Greg Warren MP, Shadow Minister for Local Government – responding to correspondence sent Noted to him by the JO regarding s7.12 contributions 13 February 2020 Hon Shelley Hancock MP, Minister for Local Government – advising that the JO Capacity Building Funding has been approved. Contracts are to be prepared for the funding. 14 February 2020 Hon Shelley Hancock MP, Minister for Local Government – advising that a proclamation has Noted been made to declare that Wagga Wagga City Council are now a member of the RivJO 21 February 2020 Hon Greg Warren MP, Shadow Minister for Local Government – thank you letter for meeting with him on 19 February and inviting the JO to raise any Noted issues or seek assistance and support in the future.
Riverina JO Board Agenda and Papers 10 February 2020 OUTGOING
Date Content Sent
7 January 2020 Cr Linda Scott, LGNSW President – advising of the Riverina JO’s response to the State Government’s Discussion Paper on a New Risk Management and Internal Audit Framework for Local Government
7 January 2020 Mr Greg Warren MP, Shadow Minister for Local Government – advising of the Riverina JO’s response to the State Government’s Discussion Paper on a New Risk Management and Internal Audit Framework for Local Government
7 January 2020 Hon John Barilaro MP, Deputy Premier – advising of the Riverina JO’s response to the State Government’s Discussion Paper on a New Risk Management and Internal Audit Framework for Local Government
7 January 2020 Hon Wes Fang MLC – advising of the Riverina JO’s response to the State Government’s Discussion Paper on a New Risk Management and Internal Audit Framework for Local Government
7 January 2020 Mr Justin Clancy MP, Member for Albury – advising of the Riverina JO’s response to the State Government’s Discussion Paper on a New Risk Management and Internal Audit Framework for Local Government
7 January 2020 Hon Shelley Hancock MP, Minister for Local Government – advising of the Riverina JO’s response to the State Government’s Discussion Paper on a New Risk Management and Internal Audit Framework for Local Government
7 January 2020 Ms Steph Cooke MP, Parliamentary Secretary to the Deputy Premier, Member for Cootamundra – advising of the Riverina JO’s response to the State Government’s Discussion Paper on a New Risk Management and Internal Audit Framework for Local Government
7 January 2020 Dr Joe McGirr MP, Member for Wagga Wagga – advising of the Riverina JO’s response to the State Government’s Discussion Paper on a New Risk Management and Internal Audit Framework for Local Government
10 January 2020 Mr Michael Blackmore, Director Water Utilities, Department of Planning, Industry and Environment – in response to correspondence received regarding applying for SSWP Funding for Regional Urban Water Planning 13 January 2020 Hon John Barilaro MP, Deputy Premier – requesting a meeting to discuss State Significant Developments: Development Consents and the Payment of s7.12 Contributions
Riverina JO Board Agenda and Papers 11 February 2020 CC: Ms Steph Cooke MP, Parliamentary Secretary to the Deputy Premier, Member for Cootamundra
17 January 2020 Dr Peter Boxall AO, Chair, Independent Pricing and Regulatory Tribunal – in regard to Inclusion of the Increased Costs of the Emergency Services Levy (ESL) and Local Government Elections in the calculation of the Local Government Cost Index
CC: Hon John Barilaro MP, Deputy Premier Hon Shelley Hancock, Minister for Local Government Ms Steph Cooke MP, Parliamentary Secretary to the Deputy Premier, Member for Cootamundra Dr Joe McGirr MP, Member for Wagga Wagga Mr Justin Clancy MP, Member for Albury Hon Wes Fang MLC Mr Greg Warren MP, Shadow Minister for Local Government Hon Mick Veitch MLC Cr Linda Scott, LGNSW President
10 February 2020 Dr Joe McGirr MP, Member for Wagga Wagga – invitation to join the Riverina JO Board for dinner and lunch on 26 and 27 February respectively
10 February 2020 Ms Steph Cooke MP, Parliamentary Secretary to the Deputy Premier, Member for Cootamundra – invitation to join the Riverina JO Board for dinner and lunch on 26 and 27 February respectively
10 February 2020 Mr Justin Clancy MP, Member for Albury – invitation to join the Riverina JO Board for dinner and lunch on 26 and 27 February respectively
10 February 2020 Hon Wes Fang MLC – invitation to join the Riverina JO Board for dinner and lunch on 26 and 27 February respectively
10 February 2020 Hon John Barilaro MP, Deputy Premier – invitation to join the Riverina JO Board for dinner and lunch on 26 and 27 February respectively
10 February 2020 Cr Linda Scott, LGNSW President – invitation to join the Riverina JO Board for dinner and lunch on 26 and 27 February respectively
21 February 2020 Hon Paul Toole MP, Minister for Regional Roads – response to the Terms of Reference for the Independent Panel on the Transfer for Regional Roads.
Riverina JO Board Agenda and Papers 12 February 2020 ATTACHMENT TWO
ADDRESSING SKILLS SHORTAGES IN LOCAL GOVERNMENT
PROJECT DESCRIPTION
This project addresses the skills shortages that Member Councils have identified as a priority in the JO’s Strategic Priorities. Most of our Member Councils have an aging workforce; in addition we anticipate that the Region’s demand for skilled labour will be put under the additional pressure as a result of the Snowy Hydro 2.0 and Inland Rail developments. Like many businesses operating in rural and regional areas our Member Councils are also facing challenges in filling highly skilled positions and need to look at new ways of addressing the issue.
This is a two pronged approach to addressing skills shortages in our Member Councils:
1. Start Your Career Here! – through the delivery of a variety of youth-focused activities the project will encourage young people attending school, TAFE and University to consider a career in local government; and
2. Sharing Highly Skilled Workers – the aim is to develop a sustainable and accountable model whereby the JO can establish shared senior positions in an identified shortage area, e.g. town planning.
Start Your Career Here!
This project will deliver on our “Grow your Own” workforce activities in the Workforce Development Priority contained in the JO’s Statement of Strategic Priorities. We are proposing working at two levels:
1. Secondary School Students – working with the Member Councils, directly with schools and through Compact (an industry-education link enterprise that works with schools in our Region) to deliver the following initiatives: a. Start Your Career Here Days – these days will be held in individual Member Councils to introduce careers in local government to secondary students. Students visit their local council to participate in a series of structured activities over two days (one in first term and one in second) that allows them to develop a better understanding of the careers available in local government.
Riverina JO Board Agenda and Papers 13 February 2020 Councils will be supported in the delivery of the program through the development of support materials that will assist them to structure the day, a JO staff member that provides them with support and guidance on structuring the day and liaise with schools to secure their involvement. In addition generalist materials on careers in local government will be developed for distribution at the days including suggested career pathways if you Start Your Career Here.
b. School-based traineeships, traineeships, apprenticeships and cadetships – the Start Your Career Here days will be used as a catalyst to initiate interest in taking on traineeships, apprenticeships and cadetships. The project will have a portal, on the JO website, for students to utilise to find out more about these types of opportunities at councils across the JO Region. The JO will also provide information to councils on the support that is available for them to take on trainees and cadets.
c. Training for Supervisor Mentors - One of the issues that has been identified by Member Councils in relation to supporting apprentices and trainees in the workplace is the capacity of supervisors to mentor young workers. The program will provide training for supervisors to assist them to work better to support young workers and will also establish networking opportunities for these supervisors so that they can support each other
d. Come and Try Events – the JO will identify events that can be conducted where students can try the careers they are interested in. The Member Councils already support the Build a Bridge and Get Over It….which allows secondary students to “try” civil engineering. Since its inception over 10 years ago approximately 35% of the students that have participated have gone on to study engineering. The JO will look at other skills shortage areas like town planning to run similar events.
2. Students at University and TAFE – working with Member Councils and with Riverina TAFE and Charles Sturt University we will be providing opportunities for students to undertake work placements with Member Councils in a wide variety of occupational areas. Again the goal is to encourage students to consider a career in local government by exposing them to the many career opportunities that exist.
The CareerStart Placements Program will seek to offer students the opportunity to undertake unpaid and paid work placements in a career area that is relevant to their TAFE or University studies. Recent discussions with Charles Sturt University indicate that many of their courses have work placement components that attract academic credit, this will assist in attracting students to the program. However, placements will not be restricted to just the courses that have academic credit it will be open to all students with councils working to accommodate the placement with the academic calendar.
Riverina JO Board Agenda and Papers 14 February 2020 We have identified the following career areas for council placements: • Accounting • Administration • Agriculture • Arts and Culture • Child Care • Clerical • Community • Economic • Environmental Development Development Science • Engineering • Finance • Horticulture • Human Resources • Information • Secretarial/Executive and IR Technology Assistant • Natural Resource • Social and • Marketing and Planning Community Planning Communications • Management • Recreation Services • Librarianship • Mapping and GIS • Strategic Planning • Town Planning
Participation in CareerStart will be recognised with a Certificate that students can include in their resumes. Paid placements may be available where there is an appropriate training wage and the student’s course allows for these types of placements, e.g. many of our councils are already participating in Charles Sturt University’s engineering program which includes permanent placements.
Sharing Highly Skilled Workers
Over the last two decades that the councils have been working together under the REROC banner, there have been a number of shared arrangements for project-specific positions. The recent shared Biodiversity Conservation Reform officer demonstrated the effectiveness of a single regional resource that was expert in a particular area of operation.
The JO proposes exploring the use of highly skilled workers in specific occupation areas, which includes formulating sustainable financial arrangements that would support the on-going employment of a person and trialling the model. Initially we are looking at town planning, building surveying and engineering as areas for exploration and trialling.
OBJECTIVES AND OUTCOMES
Objectives
• Raise awareness of the diversity of careers in local government • Increase interest in traineeships, apprenticeships, cadetships and graduate positions in local government and the Member Councils • Create an environment in Member Councils that support and mentor young workers • Identify current and emerging skills shortages in Member Councils and the JO • Develop a sustainable and viable approach to the engagement of shared, highly skilled workers for the Member Councils and the JO
Outcomes
• High quality promotional collateral that promotes careers in local government • Materials and programs designed that facilitate the delivery of Start Your Career Here days. • Identification and program development for Come and Try events for two career areas
Riverina JO Board Agenda and Papers 15 February 2020 • Training programs delivered to mentors and supervisors of young workers • Profile of Regional Local Government workforce and identification of current and emerging skills shortages • Development of a Regional Workforce Development Strategy • Agreed administrative and financial structure that supports the engagement of shared, highly skilled workers by Member Councils and the JO
PROJECT SCHEDULE
Timeframes and Milestones and Deliverables
Date Milestone Deliverable Feb 2020 1. Project Inception Execution of funding contract Formation of Project Steering Committee Engage Project Manager (part-time) Feb 2020 2. Commence negotiations with CSU and Terms of Reference for CareerStart TAFE for CareerStart student student placements developed placements April 2020 3. Support materials for Start Your Support materials uploaded to the JO Career Here Days developed website for councils to use April 2020 4. Workforce Development Group Issues paper commenced on Sharing identifies opportunities and barriers Highly Skilled workers to sharing highly skilled workers April 2020 5. Identify Come and Try events and Programs developed for two Come undertake programming and Try events May 2020 6. Finalise negotiations with CSU and MoUs signed with CSU and TAFE for TAFE for CareerStart student student placements placements May 2020 7. Identify CareerStart Placements for Placements publicised on JO website TAFE and Uni Students and publicise and through councils, TAFE and Uni May 2020 8. Councils schedule Start Your Career Calendar of events circulated Here Days for 2020 June 2020 9. Survey on workforce and skills Report prepared on skills shortages shortages completed and workforce profile June 2020 10. Training identified for Mentors and Calendar of training events made Supervisors available to Member Councils July 2020 11. CareerStart Placements commence First students placed August 2020 12. Workforce Development Group Sharing Highly Skilled Workers Paper finalises issues paper on Sharing released and presented to the Board Highly Skilled Workers for adoption October 2020 13. Two Come and Try events completed Two Come and Try events completed October 2020 14. Regional Workforce Development Board adopts Strategy Strategy finalised October 2020 15. Councils release vacancies for Vacancies advertised apprenticeships, traineeships, cadetships and graduates November 2020 16. Evaluation Project evaluated December 2020 17. Final Report Final Report prepared for Board adoption
Riverina JO Board Agenda and Papers 16 February 2020 INFORMED DECISION-MAKING IN REGIONAL FREIGHT TRANSPORT PLANNING
PROJECT DESCRIPTION
The JO’s Strategic Priorities Statement includes a Focus Area on Freight with the goal of having freight move efficiently within and through our Region. Integral to achieving this goal is our ability to identify the quantity of freight that is moving within and through our Region and the products that are being carried. This can only be determined through robust analysis of the available information.
This project will address an identified capacity issue in providing robust data to inform, underpin and validate regional strategic planning.
For this project the JO will work with the CSIRO, the Australian Road Research Board and Transport for NSW to develop a robust picture of the freight task in our Region. This information will be utilised by the JO to: • Inform the Regional Freight Transport Strategy; • formulate regional funding submissions for projects that will improve the efficiency of the transport task across the Region; • guide the JO’s lobbying activities; and • support individual funding submissions by Member Councils.
OBJECTIVES AND OUTCOMES
Objectives
• Identify the size of the intra-regional and inter-regional freight task in the JO Region • Identify the products that are moving within and through the Region • Identify opportunities to leverage the freight task to create opportunities for the Member Councils, the JO and the Region • Inform strategic freight transport planning in the Region
Outcomes
• Statistical profile of the inter-regional and intra-regional freight transport movements, by freight type and product for the JO Region • Identification of the key freight routes by volume and product for the Region • Identification of constraints on key freight routes and their financial impact and costs for industry and the Region • Strategic planning for freight transport in the Region informed by data
Riverina JO Board Agenda and Papers 17 February 2020 • Data used by Member Councils and the JO to inform funding submissions and lobbying activities
PROJECT SCHEDULE
Timeframes and Milestones and Deliverables
Date Milestone Deliverable Feb 2020 1. Project Inception Execution of funding contract Formation of Project Steering Committee May 2020 2. Transport Data obtained from Data set from ARRB delivered Australian Road Research Bureau June 2020 3. Transport Data obtained from Data set from Transport for NSW Transport for NSW delivered June 2020 4. Transport Data and Report obtained Data and Report delivered from CSIRO TraNSIT August 2020 5. Data collation completed Full set of data for the Region available for Members September 6. Regional Freight Transport Strategy Regional Freight Transport Strategy 2020 finalised completed October 2020 7. Regional Freight Transport Data Interactive mapping available for use Mapped by Members and third parties November 8. Evaluation Project evaluated 2020 November 9. Final Report Final report prepared for Board 2020 adoption
PROJECT BUDGET
Timeframes and Milestones and Deliverables
Cash In-kind INCOME Capacity Building Grant $ 50,000.00 Riverina JO $ - $ 10,000.00 Total $ 50,000.00 $ 10,000.00
EXPENDITURE CSIRO TranSIT Data Analysis $ 20,000.00 ARRB Data Analysis $ 7,500.00 Transport for NSW Data $ 7,500.00 Analysis Combine analysis $ 7,500.00 Meetings and Venue $ 3,000.00 Publication Costs $ 4,000.00 Travel $ 500.00
Riverina JO Board Agenda and Papers 18 February 2020 BEST PRACTICE IN AGGREGATED PROCUREMENT
PROJECT DESCRIPTION
The JO has committed along with a number of other JOs to contribute towards the cost of producing documentation that supports best practice in aggregated procurement.
The project will address three issues:
1. How JOs procure on behalf of its Members; 2. How a JO procures for itself; and 3. How JOs can procure in partnership with other JOs.
Three forms of aggregated procurement have been identified: 1. Administrative – where a JO provides co-ordination and management of procurement at an administrative level, this is consistent with existing collaborative procurement arrangements; 2. Delegated – procurements that are undertaken on behalf of Member Councils through the use of delegations given by the Member Councils to the JO; and 3. Direct – JOs undertake direct contracting on behalf of the Member Councils.
The project will provide guidance materials to JOs to undertake all three forms of aggregated procurement including identifying any legal impediments to their effective operation. It will include the provision of templates and other materials to assist in the procurement process.
The JOs will work closely with legal advisors and other experts to develop the products required to ensure that procurement activities undertaken by the JO meet the highest standards and comply with legislative requirements.
Through this project stronger relationships will be built both between JOs and their members, and between JOs. The completion of this project will also demonstrate the capacity and capability of JOs in delivering complex and innovative programming across multiple stakeholders.
OBJECTIVES AND OUTCOMES
Objectives
• Ensure the JO is following best practice when undertaking procurement activities • Provide a suite tools and advice that facilitates aggregated procurement by JOs • Identify potential income streams for JOs to assist with sustainability
Riverina JO Board Agenda and Papers 19 February 2020 • Demonstrate to the State Government the capability of the Joint Organisation in delivering a project • Deliver a project across several JOs to build inter-JO collaboration
Outcomes
• Suite of instruments and guidelines that facilitates procurement activities and reflects the legislative regime that governs Local Government • Identification of procurement models that inform decision making on aggregated procurement • Identification of barriers to effective procurement • Identification of potential income streams for the JO through procurement activities
PROJECT SCHEDULE
Timeframes and Milestones and Deliverables
Date Milestone Deliverable Feb 2020 1. Project Inception Execution of funding contract Formation of Project Steering Committee Feb 2020 2. Legal Advice provided on JO’s ability to procure: Report on Procurement a. for its Members; b. for itself; and c. in partnership with other JOs. May 2020 3. Documents and instruments Report and template documents developed for procurement provided August 2020 4. Advice on cost savings, innovation Report and supporting regional procurement October 2020 5. Workshop on opportunities for Workshop conducted contract development November 6. Toolkit advice Toolkit provided to JO 2020 December 7. Evaluation and Final Report Final Report tabled for adoption by the 2020 Board
Riverina JO Board Agenda and Papers 20 February 2020 ATTACHMENT THREE
NSW Small Business Strategy 2020 Discussion Paper December 2019
Riverina JO Board Agenda and Papers 21 February 2020 Contents
Ministerial Forward 4
Small Businesses and the NSW Economy 6
1. A strong, economy for small businesses to thrive 10
2. Making it easier for Small businesses to contract with Government 14
3. Making it easier to do business 18
4. Building the capability of small business 22
5. Building resilient, connected and prepared small businesses in NSW 26
6. Review of the Small Business Commissioner Act 2013 30
References 33
Riverina JO Board Agenda and Papers 22 February 2020 2 Small Business Strategy Discussion Paper 3 Message from the Minister
With over 765,000 small Last year small business employed almost 1.65 million Our vision for the small business strategy is to ensure We welcome feedback on what is working well, people across New South Wales and contributed New South Wales continues to be a great place to run how we can increase the effectiveness of current businesses in New South Wales, $55.53 billion in annual wages to employees and and invest in small business and to grow the overall initiatives, and any potential gaps to ensure an comprising 98 per cent of all more than $355 billion to annual sales. New South Wales economy. Our aim is to continue environment where small businesses can succeed. to ease the pressures and barriers that small However, the contribution of small businesses in New South Wales is the best place to live, work New South Wales businesses, business face. New South Wales is much more than just numbers and raise a family. It’s also the best place to get which includes around 230,000 – each and every business is also a valuable part of This Discussion Paper is the first step in developing out there and start and grow a business. There is small businesses in Regional a community, providing critical services, expertise a refreshed Small Business Strategy for New South more work to do, but my focus is on ensuring that and goods to families all over New South Wales, Wales. The Strategy sets out five key areas for review: the NSW Government continues to unlock new NSW, comprising about particularly in our regional areas. opportunities for small businesses. I look forward 1. A strong, economy for small businesses to thrive to hearing your feedback. 30 per cent of NSW small The NSW Government’s $97.3 billion infrastructure 2. Making it easier for small businesses to contract program is driving New South Wales forward businesses, this Government with Government and creating new opportunities for small business understands that small business to grow. Not only are we investing, in infrastructure 3. Making it easier to do business we remain committed to delivering an economic The Hon. Damien Tudehope, MLC is the heart and soul of the 4. Building the capability of small business environment where small businesses can thrive Minister for Finance and Small Business New South Wales economy. through a wide range of programs, policies 5. Building resilient, connected and prepared and initiatives. businesses in New South Wales.
Riverina JO Board Agenda and Papers 23 February 2020 4 Small Business Strategy Discussion Paper 5 Small business and the New South Wales economy
The NSW Government continues to support the The Economic Blueprint recommends developing Most small businesses Most small businesses people who work and live in New South Wales. a new NSW Trade and Investment Strategy for the in Regional NSW3 Local in Greater Sydney LGAs Small businesses are significant contributors to NSW Government’s domestic and international Government Areas (LGAs) were were located in: the New South Wales economy. Small businesses economic development priorities. The Trade and located in: paid more than $55.53 billion in wages and salaries Investment Strategy will closely align with the 1. Sydney (representing 29 per cent of all wages and salaries broader economic development agenda and the 1. Central Coast 2. Canterbury-Bankstown paid in New South Wales) and contributed more forthcoming Small Business Strategy. 2. Lake Macquarie 3. Northern Beaches 3. Tweed 4. Parramatta than $355.06 billion to annual sales and service Additionally, the NSW Productivity Commissioner 4. Shoalhaven 5. Blacktown income (representing 33 per cent of all annual sales has released a Productivity Discussion Paper titled 1 5. Mid-Coast and service income in New South Wales) in 2017-18. Kickstarting the productivity conversation. This is The NSW Government’s Chief Economist recently the first in a series of papers that will shape the released its Economic Blueprint to help define the productivity reform agenda for New South Wales. State’s ongoing needs. The Economic Blueprint The Productivity Discussion Paper aims to start a provides an overarching framework that builds on, conversation about how the NSW Government can and ties together, existing economic development best support continued growth in living standards in initiatives. The forthcoming Small Business Strategy the years ahead, recognising that higher productivity will feed into the Economic Blueprint, with a growth is key to ensuring this. The forthcoming specific focus on small business. Small Business Strategy will align with the themes of the productivity reform agenda, particularly in relation to issues faced by small business.
Which areas / sectors In Regional NSW3, the LGAs In Greater Sydney, the LGAs are with the largest growth in small with the largest growth in small Small Business2 in NSW in 2017-18 growing? businesses (between June 2017 businesses (between June 2017 Source: ABS 2017-18, 8165.0 and June 2018) were: and June 2018) were: 1. Coolamon (9.2 per cent) 1. Camden (11.1 per cent) More than 2. Cessnock (6.0 per cent) 2. Blacktown (10.5 per cent) 765,000 3. Maitland (5.7 per cent) 3. Campbelltown (8.9 per cent) small business in NSW, 4. Ballina (4.7 per cent) 4. Cumberland (8.8 per cent) compromising 98% 5. Wingecarribee (4.6 per cent) 5. Canterbury-Bankstown of all NSW businesses. NSW is home to (8.2 per cent) approximately
Around 34% of all Australian small business. Small business 230,000 67% small business in regional NSW, ownership of small business are over comprimising about Source: ABS Census, 2016 30% 33% 72% owners of NSW small business.3 40
Source: ABS 8165.0 2017-18
1 Estimated from ABS 2017-18, 8155.0. 2 A small business is defined as the sum of non-employing businesses and those with 1-19 employees. 3 Defined as businesses operating outside of the Sydney Greater Metropolitan Region , Newcastle and Wollongong. Riverina JO Board Agenda and Papers 24 February 2020 6 Small Business Strategy Discussion Paper 7 The largest increases in jobs NSW small businesses by industry over the past employ around 5 years were in:6
1.65 million Around people 1 47,000 Construction additional jobs Which sectors are creating comprising Around jobs? around 2 Professional, 36,000 scientific and additional jobs 44% technical services of the private Around sector workforce 3 21,000 Administrative additional jobs and support services
Small Business by Sector5
Professional, Scientific Rental, Hiring and Real Financial and Transport, Postal and Construction and Technical Services Estate Services Insurance Services Warehousing5 123,988 100,477 84,769 71,032 59,337
Other Services Agriculture, Forestry Health Care and Retail Trade (Personal, Religious, Administrative and and Fishing Social Assistance Civic and Interest Groups) Support Services 52,786 45,300 42,818 31,165 30,403
1 16.7% On a Transport, per capita basis, postal and The warehousing fastest-growing the NSW industries for small business 2 6.0% growth rate was New South Wales Education small businesses in and training were: 2.4% FY17-18 between June 2017 and June 3 2018, second only behind Electricity, 6.0% 4 gas, water, and Victoria at waste services Source: ABS 8165.0 2017-18. 2.6%
4 ABS 8165.0 2017-18 and 3101.0 2017 and 2018. 5 Estimated from ABS, 8155.0, 2017-18 - latest available 6 Between FY 2013 to FY 2018. Estimated from ABS, 8155.0, 2014-15 and 2017-18 – latest available. Riverina JO Board Agenda and Papers 25 February 2020 8 Small Business Strategy Discussion Paper 9 01.
IMPROVING PRODUCTIVITY IN NSW A strong economy for small The NSW Productivity Commission has developed a Discussion Paper titled Kickstarting the Productivity Conversation. The Paper examines ways to make businesses to thrive in New South Wales more competitive and support growth, identifies areas for reform based upon four core themes:
1. Making it easier to do business The NSW Government’s record $93 billion Current activities 2. Lowering the cost of living infrastructure program is driving the State forward 3. Making housing more affordable and creating new opportunities for small business REDUCING THE PAYROLL TAX BURDEN to grow. Each project, whether a new rail line, a new The NSW Government announced in the 2018- 4. Making New South Wales the easiest state or upgraded road, a school or hospital, brings with 19 Budget that it would increase the payroll tax to move to. it more jobs, more investment and more businesses threshold progressively to $1 million by 2021-22 SUPPORTING SMALL BUSINESS TO ADAPT to support communities in surrounding areas. Metro (see Figure 1). This saved nearly 40,000 businesses AND INNOVATE West, for example, will create 10,000 direct jobs and up to $5,450 each in 2018-2019 and will save up The NSW Government has introduced several This program has to date: 70,000 indirect jobs and reduce travel times from to $13,625 per business in 2021-22. The increase in initiatives to support small businesses to adapt Parramatta to the Sydney CBD to around 20 minutes. the payroll tax threshold means more than 5,000 • Supported more than 10,000 small and medium and innovate in a rapidly changing operating businesses will no longer need to meet payroll tax sized businesses (SMEs) Investments in new precincts such as the Western environment. and associated compliance costs by 2021-22. • Enabled $4.1 million in R&D collaboration Sydney Aerotropolis will bring new industries NSW Investment Concierge through TechVouchers and the jobs of the future to Western Sydney. The NSW Government is also implementing The Investment Concierge team supports trade and A strong economy also allows the NSW Government payroll tax administration reforms, resulting from • Established 23 new innovation spaces investment activities by providing a single point of to support small businesses to capitalise on the NSW Productivity Commission’s 2018 review, • Attracted more than $30 million in support contact for all investors and business enquiries. its investment. including the streamlining of payroll tax returns. from academia and industry Under these reforms businesses with a payroll tax Boosting Business Innovation Program • Been responsible for a 21 per cent increase liability of under $20,000, are now able to lodge The Boosting Business Innovation Program in revenue, according to surveyed SMEs. one annual return. While for businesses with a supports greater collaboration between New TechVouchers enable small businesses to connect payroll tax liability under $150,000, are able to South Wales research organisations and their with research experts and embark on innovative lodge one annual return and make equal automated business communities. This program is delivered in joint research projects. It also allows access to instalment payments based on their previous partnership with universities and Commonwealth high-tech instruments and facilities that would year’s liability. Scientific and Industrial Research Organisation otherwise be difficult to access. Small businesses (CSIRO). It aims to enable access to technology, are awarded up to $15,000 in matched funding equipment, research and expertise to build an FIGURE 1: NSW GOVERNMENT PAYROLL TAX THRESHOLDS on a competitive basis for research collaboration. innovation ecosystem and stimulate economic growth across the State. Tax year Threshold
1 July 2019 to 30 June 2020 $900,000
1 July 2020 to 30 June 2021 $950,000
1 July 2021 to 30 June 2022 $1 million
Source: Revenue NSW
Riverina JO Board Agenda and Papers 26 February 2020 10 Small Business Strategy Discussion Paper 11 Priority industries development strategies The NSW Government is engaged in several Discussion 1.1 industry-focused strategies including Advanced Manufacturing, Food and Beverage Manufacturing, questions What other strategies could boost the Medical Technology and Cyber Security Industry New South Wales economy and provide Development. These strategies are designed to: an environment for small businesses to start, • Support industries to commercialise research grow and invest? and development • Encourage industry collaboration • Emphasise the importance of skills development • Grow exports and attract investment. 1.2 What barriers do small businesses face when As part of the strategy, a program has been diversifying and growing their businesses? created for each of these industries to strengthen engagement and collaboration (the Connect Program). Local Innovation Network 1.3 The Local Innovation Network, a $2.1 million What support do Aboriginal people, commitment, is designed to foster innovation people with a disability and migrants across the State, with a focus on boosting our need in small business? regions. The investment goal is to develop regional entrepreneurship and support start-ups and SMEs, SUPPORTING WOMEN IN BUSINESS as well as removing the barriers which isolate regional founders from each other. The NSW Women’s Strategy makes economic opportunity and advancement for women a key 1.4 Regional Growth Fund pillar in addressing gender inequity. Key initiatives Tourism comprises a large part of Regional under the Year Two Action Plan, which encourages What export barriers do small businesses New South Wales’ small business revenue. more women into small business, include: face? The $300 million Regional Growth – Environment • Sydney School of Entrepreneurship speaker and Tourism Fund aims to increase tourist events and workshops in regional and rural areas visitation by investing in regional environment on female entrepreneurship and tourism infrastructure, particularly focusing 1.5 • TAFE NSW’s online educational program to 5,000 on fixed assets that will grow and further diversify What obstacles are there to small businesses regional economies. Small business benefits women on small, micro and start-up businesses conducting research and development? from the investment in new or upgraded tourism • Establishing an Innovation Colab to link infrastructure as it becomes a demand driver government, industry, venture capital, start-ups, for the regions to attract new visitors.7 female entrepreneurs and mentors. 1.6 What key issues do regional small businesses face? 1.7 What barriers do women face when starting and sustaining a small business? 1.8 In what other ways can NSW Government reduce the regulatory burden on small business?
7 www.nsw.gov.au/improving-nsw/regional-nsw/regional-growth-environment-and-tourism-fund
Riverina JO Board Agenda and Papers 27 February 2020 12 Small Business Strategy Discussion Paper 13 02.
BUY.NSW SECURITY OF PAYMENTS Making it easier to contract The NSW Government recognises that more small The NSW Government recognises the importance businesses are running their businesses digitally, of small businesses getting paid, and paid on as well as the benefits to the economy of buying time, for work completed. On 21 October 2019, the with Government local. The new website, Buy.NSW, is a digital Building and Construction Industry Security of marketplace that connects businesses with Payment Amendment Act 2018 and the Building government buyers and provides a suite of simple and Construction Industry Security of Payment online resources to assist small businesses in Amendment Regulation 2019 commenced. These bidding for NSW Government contracts. Buy. reforms promote cash flow in the supply chain, The NSW Government has developed the NSW • Giving SMEs a voice through NSW makes it easier to register as a supplier to increase transparency of payments and provide Government Procurement Policy Framework, a new feedback tool government, and for government buyers to locate greater protection to subcontractors. and purchase from local businesses which provides a consolidated view of government • Making it easier to buy directly from small INDUSTRY CAPABILITY NETWORK NSW procurement objectives and the requirements of businesses for values up to $50,000 FASTER PAYMENT TERMS The NSW Government funds the Industry Capability selling to NSW Government. • Giving SMEs first consideration by government The NSW Government recognises that cashflow Network NSW (ICN NSW) to deliver free of charge Small businesses can face multiple obstacles when agencies for values up to $250,000 has always been a major issue for small businesses procurement advice and business matching to accessing opportunities and contracting with • Making it easier to engage SMEs for and is committed to faster payment cycles. New South Wales project owners and suppliers on government. Barriers can include the complexity proof-of-concept testing or outcome-based Payments of up to $10,000 can now be paid major projects. The NSW Government recognises of procurement processes, difficulty finding trials valued at up to $1 million instantly by all NSW Government agencies for the importance of bridging the information gap opportunities, onerous administrative compliance small businesses with credit card facilities. From between buyers and sellers and the ICN NSW • Requiring agencies to consider SMEs in all requirements, restrictive selection criteria, and December 2019, all registered small businesses provides services that make it easier for procurements valued above $3 million through unnecessarily complex requirements. must be paid within five business days for goods New South Wales small businesses to grow in the specific evaluation criteria. and services worth up to $1 million, through a following ways: The NSW Government recognises that procurement correctly rendered invoice. offers small business the opportunity to work on • Working with project owners to publish projects THE POLICY IS UNDERPINNED BY FOUR state-of-the-art projects, while supporting local ABORIGINAL PROCUREMENT POLICY AND and their associated work packages on the PRIMARY OBJECTIVES: jobs and building skills. To assist small businesses CONCIERGE SERVICE online Gateway, increasing market awareness 1. Supporting local businesses, start-ups in procuring Government work and building their The NSW Government’s Aboriginal Procurement of business opportunities and innovation, and primary industries capabilities, the NSW Government has implemented Policy enables NSW Government agencies • Providing advice to project owners about the following initiatives. 2. Building SME capability to supply to negotiate directly with Aboriginal-owned suppliers qualified to deliver work or supply to government businesses for contract values of up to $250,000. to those projects, increasing supplier The policy aims to award Aboriginal-owned market information 3. Making supplying to government businesses at least three per cent of all NSW Current activities easier for SMEs • Monitoring the work package expressions of Government domestic contracts for goods interest submitted by potential suppliers to SMALL AND MEDIUM ENTERPRISE (SME) 4. Listening to local businesses and and services by 2021. assess compatibility and contacting known AND REGIONAL PROCUREMENT POLICY measuring participation. Additionally, to enable more Aboriginal-owned suppliers who would normally be expected The NSW Government’s Small and Medium businesses to gain access to government to meet requirements to express interest Enterprise (SME) and Regional Procurement procurement opportunities, the NSW Government (supplier-opportunity matching). Policy is part of the broader NSW Government has commenced a “concierge service” which Procurement Policy Framework and is designed assists Aboriginal-owned businesses through the to increase participation of SMEs and regional prequalification scheme registration process. businesses in the government procurement of goods and services through a range of initiatives, including:
Riverina JO Board Agenda and Papers 28 February 2020 14 Small Business Strategy Discussion Paper 15 Discussion 2.1 Is there anything else the NSW Government question could do to assist small business to access NSW Government procurement opportunities?
Riverina JO Board Agenda and Papers 29 February 2020 16 Small Business Strategy Discussion Paper 17 03.
A small bar owner using the program can open IMPROVING LOCAL GOVERNMENT Making it easier their doors up to 5.5 months faster and a cafe or PROCUREMENT OPPORTUNITIES restaurant owner up to three months faster. In June 2019, the NSW Government amended to do business Restaurants, cafes and takeaways located in eight local government procurement regulations, making local government areas that have adopted the it possible for councils to purchase products and State-wide Outdoor Dining Policy, are now able to services worth up to $250,000 without going expand their businesses outdoors via a two-day to tender. approval process if they so desire. EASY TO DO WORK HEALTH SAFETY TOOLKIT PARTNERING WITH LOCAL COUNCILS SafeWork NSW has released an Easy to do Work The NSW Government is committed to reducing unnecessary red tape and the regulatory burden on THROUGH THE SMALL BUSINESS FRIENDLY Health Safety Toolkit to make is easier for small small businesses. Through streamlining processes and facilitating an efficient digital experience, the NSW COUNCILS INITIATIVE businesses to comply with their health and safety Government is making it easier to do business in New South Wales. Current initiatives to simplify and obligations through a self-assessment tool, helping enhance the experience of small businesses are outlined below. Local councils play a key role in ensuring a friendly and supportive environment for small businesses to make workplaces safer. to start and grow in their communities. The Small AGRI-TOURISM Business Friendly Councils program provides New A pilot is underway in three council areas to make South Wales councils with information, initiatives – How-to guides which provide industry specific it easier for farmers to diversify their income and Current activities and resources to support their local businesses information on the processes, regulations, operate agri-tourism businesses. to start and grow. An integral part of the program SERVICE NSW FOR BUSINESS: timeframes and costs involved for small business is the earlier mentioned Making Business Easier MAKING BUSINESS EASIER owners in five sectors (Cafes, Restaurants and initiative, which provides councils with a digital Service NSW, in the new Department of Customer Small Bars, Housing Construction, Clothing platform and state-wide policy solutions reducing Service, is delivering the Making Business Easier Retail, Printing Services, and Road Freight). red tape and paperwork. program. The program provides one ‘front door’ Business owners can now find all regulatory to three levels of government for small business RETAIL SECURITY BOND SCHEME information in one location, enabling them to spend owners. It’s a free service offering personalised less time on paperwork and more time achieving The NSW Government manages retail bonds, support and aims to make New South Wales the their business goals. enabling retail businesses to securely lodge and easiest place to start, run or grow a business. manage their bonds in one place. The program features: The program has formed deep partnerships with councils to ensure we can assist customers right MAKING IT EASIER FOR HOME-BASED • A Business Concierge service providing free across their small business journey. A total of BUSINESSES personalised support and step-by-step guidance 117 councils, covering 92 per cent of the State’s A new web-based resource provides to navigate requirements (licences, permits etc) population (as at 14 November 2019), have passed comprehensive information for home business across all levels of government, with reduced resolutions to work closely with the Making owners on a range of topics relevant to starting, regulatory burden. Business Easier program. operating and growing a home business in New • A digital platform with: South Wales. This includes the requirements Business owners in the Cafe Restaurant Small Bar to operate a business from home, where to go – A personalised dashboard tool to help business industry previously had to complete up to 48 forms for support and transitioning when a business owners in the Café, Restaurant and Small Bars and deal with up to 15 agencies, while builders and outgrows the home. industry and the Housing Construction industry tradies had to complete up to 51 forms and deal to manage their regulatory obligations, complete with up to 17 agencies. They now have one central or initiate transactions across three levels of starting point for all their needs. government and keep track of their progress.
Riverina JO Board Agenda and Papers 30 February 2020 18 Small Business Strategy Discussion Paper 19 Discussion 3.1 What things are working well and how questions can we increase their effectiveness? 3.2 Which sectors or industries have the most ‘pain points’ and could be a focus for the next stage of ‘easy to do business/making business easier’? 3.3 Are there different challenges for small businesses interacting with the NSW Government in regional areas compared with those operating in Sydney and larger metropolitan centres? If yes, why are they different?
Riverina JO Board Agenda and Papers 31 February 2020 20 Small Business Strategy Discussion Paper 21 04.
SKILLS FOR BUSINESS Building small business capability TAFE NSW’s Skills for Business initiative offers fully subsidised, flexible training in business SMART, SKILLED AND HIRED management, digital and financial skills for New The NSW Government recognises that access South Wales small businesses. It supports existing to the right skilled employees is critical for small small business owners, as well as new entrants business success and has introduced a range seeking to establish a small business through the of initiatives to upskill employees. Certificate IV in New Small Business. The Smart, Skilled and Hired Program aims to The Business Bytes programme is also part of help businesses leverage growing demand in The NSW Government has introduced a range of Only 53% of small businesses the Skills for Business initiative and is designed the disability and construction sectors. It is support measures to increase skills and capabilities to give time-poor small businesses cutting-edge in New South Wales have an also designed to help young people overcome to ensure small businesses can succeed. It also information on online marketing and cyber security. recognises that access to the right skilled employees internet presence, compared employment barriers and get them into jobs is critical for success and has introduced a range of to 94% of large businesses Business Bytes is delivered through live tutorials with local businesses. Its focus areas are youth initiatives to assist with growing the talent of the with trainers and fellow participants, allowing employment; regional upskilling and employment New South Wales population. These initiatives are (NSW Innovation and small business owners and staff to collaborate to benefit from the State’s record infrastructure outlined below. Productivity Council, 2019). and gain feedback on business ideas, challenges investment; and supporting small and medium and plans. Participants can learn from successful enterprises in the disability sector. Having an internet presence entrepreneurs sharing their knowledge and INCREASING INNOVATION AND helps with a business’ brand experiences, from launching a start-up to managing ENTREPRENEURIAL SKILLS profile, engagement with cash flow and growing their customer base using the latest in digital and social marketing. The NSW Government established the Sydney customers or suppliers, and School of Entrepreneurship (SSE) though a $25 EXPORT ACCELERATOR TOOLKIT access to international markets. million cornerstone investment to improve access The NSW Government recognises that planning to entrepreneurial training and education and is critical for exporting and has developed the deliver future generations of entrepreneurs. Export Accelerator Toolkit to provide guidance on The NSW Women Entrepreneurs Network is a export opportunities. The toolkit helps to assess “one stop shop” to help women to start and grow opportunities, identify if a business is ready for Current activities businesses. It was co-created by government export, the people and organisations who could and industry to build community, extend BUSINESS CONNECT AND NSW FIRST help, and the logistics involved. networks and share resources and support The $30 million Business Connect small business The Export Capability Building Program aids through collaboration between TAFE NSW advisory program provides a network of business exporters across the State. It provides exporting and New South Wales universities. advisors to answer questions and provide fee- workshops to increase export-readiness, export THE SYDNEY STARTUP HUB free and low-cost assistance to small businesses. labs where in-depth discussions are held on a key Sydney is Australia’s start-up capital – 64 per It includes specialist advice for select sectors and trade issue and country briefings which examine cent of all Australian tech start-ups have been business skills training. a significant overseas market. The program also launched here. The NSW Government encourages includes informative webinars on topical issues for Similarly, the NSW Government has established start-ups to base their businesses in Sydney and exporters. the NSW First program to help tourism businesses New South Wales in general, to contribute to develop, promote and sell their tourism products. our dynamic economy. The Sydney Startup Hub, It includes face-to-face workshops and online launched in February 2018, is one such example webcasts offering ‘how-to’ insights on a range of of NSW Government support and has since become topics for the tourism industry, with events to be a globally renowned innovation centre. added to the calendar throughout the year.
Riverina JO Board Agenda and Papers 32 February 2020 22 Small Business Strategy Discussion Paper 23 REGIONAL SUPPORT NSW SMALL BUSINESS MONTH OCTOBER Access to skilled and experienced workers in NSW Small Business Month highlights the Discussion 4.1 Regional New South Wales can be challenging, contributions these businesses make to our regardless of whether the business is setting up economy. The entire month of October is dedicated questions Are the above NSW Government initiatives shop, relocating or already operating. The NSW to celebrating small businesses – from the intender working well? If yes, why? If no, what is Government has committed $10 million for the with a great idea to an established business looking not working? Regional Skills Relocation Grant over the next four to expand. The events program aims to inspire, years, providing grants of up to $10,000 per upskill and connect the small business community eligible skilled worker to assist with the relocation across New South Wales, while all events are costs from metropolitan areas to regional designed to help both metropolitan and regional New South Wales. small business owners improve their productivity, 4.2 grow their business, and engage with other How can we improve the effectiveness Under the NSW Emergency Drought Relief businesses with similar goals. of the current initiatives? package, the NSW Government has also introduced fully subsidised skills training for farmers and PREMIER’S NSW EXPORT AWARDS regional businesses impacted by the drought, The Premier’s annual Export Awards acknowledge which includes many small businesses (see further the important contribution exporting small drought assistance in Chapter 5). Smart and Skilled businesses make to the New South Wales economy 4.3 approved providers, including TAFE NSW, are able through job creation and increased prosperity. The What are the gaps the NSW Government to offer a range of training to support impacted Small Business category showcases successful New could address? individuals with pathways to alternative income South Wales small business exporters and winners sources or new career options. automatically progress as national finalists to the BUILDING THE WORKFORCE OF annual Australian Export Awards. Blowfish Studios THE FUTURE AND INCREASING was the NSW Small Business Export Winner in 2019. 4.4 THE SUPPLY OF QUALITY WORKERS What other initiatives could the NSW To support the pipeline of skilled workers across Government undertake in the area of the State, the NSW Government has committed an skills and training? additional 100,000 fee-free TAFE and VET courses from 1 January 2020. This is comprised of 70,000 new fee-free courses for young job-seekers taking on traineeships and 30,000 free TAFE places for Businesses are increasingly using mature-aged workers seeking to retrain or re-enter big data and predictive analytics to 4.5 the workforce. better understand customer needs, What other initiatives could the NSW The NSW Government is also investing in the delivery with nearly half of small businesses Government undertake to value, recognise of new TAFE facilities across the State, including: using predictive data analysis. and connect with small business? • $79.6 million over four years for a new TAFE However, this is still well below the super campus for Western Sydney, specialising in construction trades percentage of large businesses in • $61.7 million over four years to construct eight New South Wales (86 per cent) new TAFE Connected Learning Centres in rural (NSW Innovation and Productivity and regional locations including Byron Bay, Nelson Bay, Batemans Bay, Jindabyne, Nambucca Council, 2019). Heads, Hay, Cobar and West Wyalong • $34 million in capital expenditure over two years to establish a pilot program for two senior secondary vocational schools in Western Sydney and the North Coast.
Riverina JO Board Agenda and Papers 33 February 2020 24 Small Business Strategy Discussion Paper 25 The New South Wales Government has committed over $1.8 billion to drought relief in NSW, with assistance measures aligned with the intergovernmental Agreement on 05. Drought Program Reform.
INNOVATION AND CYBER SECURITY • The Farm Business Skills Professional Building resilient, connected The NSW Government’s Innovation Strategy Development Program provides primary offers new opportunities to attract investment producers with access to vocational training into the New South Wales economy for innovative and farm business planning. and prepared small businesses businesses, while the Business Connect small • The $100 million Drought Assistance Fund business advisory program has a specialist digital provides $50,000 in interest-free loans to program to assist in building digital capabilities for primary producers to implement systems Many small businesses across New South Wales have been affected in recent years by disruptions in the small business. and management practices to enhance the form of either natural disasters such as floods, storms or bushfires, or man-made disruptions arising from sustainability of their farm business. The loan The NSW Cyber Security Industry Development changing market conditions, operating models, technological shifts, cyber-attacks, business disputes or funds the transport of stock, fodder and water, Strategy, released in 2018, outlines four key themes government policy. The NSW Government is committed to helping small businesses build their resilience and genetic banking of breeding herds, installation to support the sustainable growth of the cyber has a proven track record of supporting those that experience disruption or disaster to help them survive of on-farm fodder and water infrastructure and industry. These include; start-ups and SMEs, and get back to business quickly. activities that promote profitability and resilience attracting investment, promoting export services as a result of the on-farm investment. and products, and building on skilled labour to Current activities meet industry demand. Additionally, procurement • The $170 million drought stimulus package delivers local infrastructure projects such as REGIONAL DIGITAL CONNECTIVITY PROGRAM under the Retail Leases Act 1994, aims to reduce policies for digital products and services and the NSW Cyber Security Connect Program aim airport upgrades, activation of industrial land and The $400 million Regional Digital Connectivity the time and costs associated with litigation to improve early-stage product development to CBD revitalisation projects. This will help to retain program will ensure families and businesses across between retail landlords and tenants. The NSW ensure small businesses are equipped to deal with local jobs and spending on local businesses. regional New South Wales have better access to Small Business Commission also provides cyber security threats. mobile, internet and digital services. The program mediation and dispute resolution services for ENERGY EFFICIENCY PROGRAMS focuses on three priority areas of mobile coverage, general small business disputes. Around 90 per DROUGHT ASSISTANCE The NSW Government offers discounts and cent of disputes are resolved prior to lengthy internet and data, and farm and water. The current drought began in New South Wales incentives for business to reduce energy use and and costly court proceedings. GET READY BUSINESS TOOLKIT in mid-2017 and is one of the most severe the save on power bills. The following are examples of SUPPORT WHEN A DISASTER OCCURS State has experienced. The NSW Drought Strategy the schemes in place: The Get Ready Business Toolkit is a resource to help encourages primary producers to plan ahead in small businesses plan and prepare for unexpected When an emergency event occurs, NSW • The Energy Saving Scheme (ESS) provides normal conditions to prepare and build in flexibility disasters in five easy steps. Being well prepared Government cross agency teams coordinated by financial incentives to install energy efficient to deal with adverse conditions. The following can mean the difference between a small business the Office of Emergency Management go out on equipment and appliance in NSW households and categories provide a snapshot of government being up and running again in a few days or taking the ground to provide a range of support. They businesses objectives and assistance measures to enhance months to reopen, or even never reopening. work with affected communities immediately after • Commercial refrigerator rebates provides small regional drought preparation: the event, and through the recovery phase which MEDIATION AND DISPUTE businesses with rebates for replacing older can take years in some cases. This includes support • The establishment of the Office of Drought RESOLUTION SERVICES fridges with newer, more energy efficient models for affected small businesses, from assistance with Response which will work to ensure water • The lighting upgrade offer provides discounts to Disputes are stressful for small business owners applying for grants and other support services to security, address the impact of drought on and can involve considerable time and cost. small businesses looking to switch their lights to resources and training to help them recover. business and communities and provide ongoing energy efficient LEDs The Registrar of Retail Tenancy Disputes, established support to farms. • Online energy management courses and face- • The $1 billion Farm Innovation Fund provides to-face workshops that focus on practical ways long-term low interest loans to help improve businesses can become more energy efficient. permanent on-farm infrastructure. Australian businesses are “completely unprepared” • Subsidies towards the cost of transporting fodder, for cyber-attacks or data breaches, with reported incidents water to a property for stock or domestic use, stock to and from agistment, and stock increasing by more than 700 per cent since February last year, to sale or slaughter. costing the nation $7.8 billion (Connory M, 2019).
Riverina JO Board Agenda and Papers 34 February 2020 26 Small Business Strategy Discussion Paper 27 Discussion 5.1 Are the above current NSW Government questions initiatives working well? If yes, why? If no, what is not working? 5.2 How can we improve the effectiveness of current initiatives? 5.3 What are the gaps that the NSW Government could address?
Riverina JO Board Agenda and Papers 35 February 2020 28 Small Business Strategy Discussion Paper 29 06.
Review of the Small Business Discussion 6.1 What should be the objectives and function Commissioner Act 2013 questions of the Small Business Commissioner? Why? 6.2 What, if any, objectives or functions should be The NSW Government established the position • to encourage productive working relationships removed from the Act and why? of NSW Small Business Commissioner (‘the between small businesses and governments and Commissioner’) in 2011. The Commissioner larger businesses has been dedicated to supporting and improving • to support the resolution of disputes involving the operating environment for all small businesses small businesses through mediation and other in New South Wales. forms of alternative dispute resolution 6.3 The Commissioner and the Office of the Small • to support and encourage fair treatment and a Describe any other administrative tools that Business Commissioner undertake a diverse fair operating environment for small businesses the Small Business Commissioner should have range of functions, working both inside and • to identify and support measures to reduce to undertake their functions effectively? outside government. They advocate on behalf of small businesses’ administrative burden. small businesses, provide mediation and dispute resolution services, assist with policy development Part 2 Division 2 of the Act also outlines the and reform, and help businesses affected by general functions that the Commissioner will 6.4 disruption and emergencies. exercise in pursuit of his or her objectives. These Please provide details of any other issues This broad remit requires equally broad are largely, though not entirely, aligned with the or feedback in relation to the Act or the engagement with the State’s small business Commissioner’s objectives: Commissioner’s functions. community. In 2018, the NSW Small Business • to receive and deal with complaints made by Commissioner assisted more than 25,000 small or on behalf of small businesses businesses and engaged with 210 policy and regulatory proposals. • to investigate or refer complaints • to provide low-cost alternative dispute resolution The Small Business Commissioner Act 2013 (NSW) for small businesses (‘the Act’) establishes the objectives, functions, and powers of the NSW Small Business Commissioner. • to make representations and act on behalf of small businesses – including in legal proceedings Objectives and Functions • to conduct investigations into the treatment of small businesses by government or other of the Commissioner businesses Part 2 Division 2 of the Act sets out the objectives • to support the development of industry codes of the Commissioner: of practice that deal with issues affecting small businesses • to deal with issues concerning small businesses in a neutral and independent manner • to advise the Minister for Small Business on matters affecting small businesses. • to field complaints from small businesses about their dealings with government and other businesses
Riverina JO Board Agenda and Papers 36 February 2020 30 Small Business Strategy Discussion Paper 31 References
ABS (Australian Bureau of Statistics) 2016, Connory M., 2019, Annual Report – State of Cyber Census of Population and Housing: Estimating Security, Security in Depth, Melbourne. Homelessness, ABS Cat No 2049.0, Canberra. Glover A., 2009, Accelerating the SME economic ABS (Australian Bureau of Statistics) 2017-18, engine: through transparent, simple and strategic Australian Industry, June 2017 to June 2018, procurement, London. ABS Cat No 8155.0, Canberra. NSW Innovation and Productivity Council, 2019, ABS (Australian Bureau of Statistics) 2014-15, Business Size Report, Sydney. Australian Industry, June 2014 to June 2015, Revenue NSW, Rates and Thresholds, Revenue NSW. ABS Cat No 8155.0, Canberra. Riding A., Orser B., Liao D, 2018, Benchmarking ABS (Australian Bureau of Statistics) 2017-18, Small and Medium Enterprises as Suppliers to the Counts of Australian Businesses, including Entries Government of Canada: Inclusion, Innovation and and Exits, June 2013 to June 2018, ABS Cat No International Trade, Ottawa. 8165.0, Canberra. ABS (Australian Bureau of Statistics) 2018, Counts of Australian Businesses, including Entries and Exits, June 2017 to June 2018, ABS Cat No 8165.0, Canberra.
Riverina JO Board Agenda and Papers 37 February 2020 32 Small Business Strategy Discussion Paper 33 Riverina JO Board Agenda and Papers 38 February 2020 ATTACHMENT FOUR
RESPONSE TO THE DISCUSSION PAPER
A New Risk Mangement and Internal Audit Framework Riverina Joint Organisation
Contact: Julie Briggs CEO Riverina Joint Organisation PO Box 646, Wagga Wagga NSW 2650 Ph: (02) 69 319050 Email: [email protected] www.riverinajo.nsw.gov.au
Riverina JO Board Agenda and Papers 39 February 2020 A NEW RISK MANAGEMENT AND INTERNAL AUDIT FRAMEWORK for local councils in NSW Response to the Discussion Paper Riverina Joint Organisation
Introduction This response to the Discussion Paper on A New Risk Management and Internal Audit Framework has been prepared after consultation with the Riverina Joint Organisation’s Member Councils. The Riverina Joint Organisation’s Member Councils are: Bland, Coolamon, Cootamundra- Gundagai, Greater Hume, Junee, Lockhart and Temora councils as well as Riverina Water and Goldenfields Water County Councils.
Our Members agree with the Minister’s assertion that risk is inevitable in any organisation including local councils. Councils across NSW have recognised this, with over 70% already having in place internal audit and risk regimes. Our Members are disappointed that the Discussion Paper has not reviewed the regimes that are already in place, in order to identify the shortcomings that justify the introduction of the very expensive and complex approach proposed in the Discussion Paper.
Further, the Discussion Paper, which details the regulatory requirements and operational Framework, has been prepared with virtually no consultation with the sector. The Minister states that the Framework reflects the “unique needs, structure and resources of NSW Local Government”. However, our Members question how the proposed approach will “ensure that councils achieve their strategic objectives in the most efficient, effective and economical manner” given the cumbersome, expensive and resource intensive approach that is being proposed.
Our preliminary costings for the implementation of the proposed Framework, which are attached in Appendix A show that the estimated total cost for Medium and Small sized councils will be over $450,000 per annum. The cost falls significantly in a shared arrangement but is still over $170,000 per annum. However, this is based on the assumption that it is feasible for the Chief Audit Executive (CAE) to work for all nine Riverina JO Member Councils and the JO. It is also based on the assumption that the Audit, Risk and Improvement Committee (ARIC) will be able to cover all its work for the Member Councils over 2 days of meetings in a single location and that there are only five ARIC meetings per year. If meetings need to be held in individual LGAs then the travel, accommodation and meeting payments will be considerably higher.
The above costings to do not factor in the additional time burdens on council staff to meet the demands of the CAE and the ARIC for the provision of information and attendance at meetings.
In relation to the application of the regime to the operation of Joint Organisations, our Members agree that the complexity of the regime is disproportionate to the operations of not only the Riverina JO but we would suggest most of the JO operations across NSW. Our Members agree that this regime should not apply to Joint Organisations.
Response to the Key Questions We note that respondents have been asked to address key questions in relation to the proposal. Our responses to the key questions are below:
Riverina JO Board Agenda and Papers 40 February 2020 Will the proposed internal audit Framework achieve the outcomes sought? This is a complex, process-driven and expensive approach and given its substantial cost it should achieve the outcomes sought. However, the achievement of the outcomes will undoubtedly divert much needed resources from front-line services and facilities. There is no hard evidence that the process will result in increased efficiencies and savings, consequently our Members believe the cost/benefit does not justify its implementation.
We believe more cost-effective approaches would achieve the same outcomes. If the Office of Local Government had undertaken a review of the existing arrangements in the 70% of councils that already have an audit function in place we are sure that a more affordable approach would have been identified.
What challenges do you see for your council when implementing the proposed Framework? The cost of the delivery will be a significant challenge for small and medium sized councils.
The significant requirements for appointment to an ARIC will be a major barrier to the effective implementation of the regime and is likely to result in significant cost impositions. Committee members must be prequalified via the NSW Government’s Prequalification Scheme. The process requires applicants to meet evaluation criteria including, among other things:
• Extensive senior level experience in governance and management of complex organisations • Functional knowledge in areas such as risk management, performance management, human resources management, internal and external auditing, financial reporting, accounting, management control Frameworks, financial internal controls, governance or business operations. • Possession of a relevant professional qualification or membership such as Certified Internal Auditor, Certified Practising Accountant, Certified Practicing Risk Manager, Member of the Australian Institute of Company Directors. • Must also be able to demonstrate leadership qualities, an ability to communicate complex and sensitive assessments tactfully and sound understanding of governance, accountability, financial reporting, internal audit operations and risk management principles.
Exclusions include current employees of all NSW public sector agencies, in addition the independent committee member cannot:
• be a councillor of any council in Australia, a candidate at the last election of a council or a person who has held office in a council during its previous two terms or be employed (currently or during the last three years) by any council in Australia or have a close personal or business relationship with a councillor or a person who has a senior role in the council; • be a current service provider to the NSW Audit Office, or have been a service provider during the last three years; • currently, or within the last three years, provided any material goods or services (including consultancy, legal, internal audit and advisory services) to the council which directly affect subjects or issues considered by the Audit, Risk and Improvement Committee; • be a substantial shareholder, owner, officer or employee of a company that has a material business, contractual relationship, direct financial interest or material indirect financial interest with the council or a related entity, or have an immediate or close family member who is, which could be perceived to interfere with the individual’s ability to act in the best interests of the council; or
Riverina JO Board Agenda and Papers 41 February 2020 • currently or previously have acted as an advocate of a material interest on behalf of the council or a related entity.
The pre-qualification criteria is restrictive and precludes many who would add value to Local Government audit processes by the mere fact that they have contextual knowledge about council policies and practices. For example, a retired local government auditor would be perfectly placed to ask relevant questions about council finances and question the conduct of audits. However, under the pre-qualification guidelines, he or she would be prohibited from consideration by the fact that they had been engaged in the local government sector.
Similarly, persons who are currently serving on Audit Committees for councils would be precluded from serving on an ARIC because of the prohibition on those who had provided goods or services to council in the last 3 years.
While excluding people who had previously served as elected representatives on a council that the ARIC is auditing, is understandable, the total exclusion of any person that has ever served on a council anywhere in Australia makes little practical sense. The Local Government knowledge these people hold would be a valuable asset in assessing and reviewing council operations. The current criteria prohibit current and former councillors from all jurisdictions from seeking pre-qualification, which is “overkill”. This means that a person who served on a council in Western Australia is prohibited from being part of an ARIC.
Rural and regional councils are going to struggle to find suitable people to serve on their ARIC and the long list of prohibitions is going to make it almost impossible. This may force councils to choose from a limited pool of metropolitan-based people that have little practical experience or knowledge of the operation of a council in a rural, remote or regional context. In addition, it is likely to increase the costs associated with the operation of the ARIC because of transport and accommodation costs.
Finally, we believe that even in a shared arrangement, councils in rural areas are likely to struggle to find suitably qualified people to fill the CAE position. This position requires a very specific set of skills, and generally those with those skills in regional areas are in high demand. The Framework does facilitate the use of an existing senior staff member in the role however because councils cannot put someone in the position that has previously had carriage of an area that is being audited. The position cannot be out-sourced unless through a shared arrangement. Our Members are very concerned that they will not be able to easily recruit for this specialist position.
Does the proposed Framework include all important elements of effective internal audit and risk Framework? Given the significant costs and resourcing to be allocated to the Framework our Members believe that the important elements are included.
However, it is not clear how the development of the proposed Risk Management Framework will contribute to the Minister’s stated goal of achieving a council’s “strategic objectives in the most efficient, effective or economical manner”. At a time when there is a lot of focus on stripping away “red tape” to improve efficiency; the complexity, reporting, paperwork, staffing and administration required to deliver the proposed Framework cannot possibly result in the more efficient, effective or economic delivery of a council’s strategic objectives.
Taking into account the costs associated with engaging the ARIC, the CAE, the Risk Management Officer and additional administrative staff, the logical outcome, particularly for rural councils will be a reduction in resourcing of front-line services. There is a danger that focusing inward on the
Riverina JO Board Agenda and Papers 42 February 2020 examination of council processes will be at the cost of the on-ground services that residents genuinely value.
We believe that the Framework does not recognise the distinct differences and resource capabilities of rural councils compared to metropolitan councils and State agencies. While there is an opportunity to embark on joint arrangements, this still results in expensive outcomes. It would have been far better if frameworks had been developed that reflected the operational realities of councils across NSW, instead a regime that applies to the City of Sydney applies equally to Coolamon Shire Council.
In relation to the fees proposed for the Chairperson, it appears that the Chair will be paid a flat rate only. If multiple meetings are required, then Chairs who took on the position believing the obligation was for 4 meetings a year, may feel they are not being adequately compensated for the additional work. It may be better to set the fixed fee at a lower level and include a meeting fee on top. If meetings for Joint Arrangements cannot be held in a central location and the ARIC members are required to travel this is likely to increase questions relating to the Chair’s remuneration.
Is there anything you don’t like about the proposed Framework? Our Members do not believe that the cost warrants the benefits that will accrue from the adoption of the Framework, particularly for small rural and remote councils. The Framework is too complex and too expensive, the cost of delivery will detract from the delivery of on-ground services and support to the community.
The Minister states in the Foreword that the Framework is “based on international standards and the experience of Australian and NSW government public sector agencies”. It is a Framework suited to large complex organisations where the most senior staff have little contact with day-to-day operational staff and where ministerial interactions and reporting do not occur with the same frequency and depth as occurs at monthly council meetings where staff report to councillors on every area of council operations.
The Framework ignores the flatter staffing structures of rural councils where the General Manager interacts with every senior staff member every day and most operational staff on at least a weekly basis. There are already checks and balances in place in these councils because of their proximity to staff, councillors and the community. The councillors are charged with ensuring the council’s strategic objectives are delivered efficiently, effectively and economically and they do this at every council meeting that is held.
Our Members are concerned that the Framework fails to recognise the role that councillors play in monitoring the operation of a council. The ARIC’s powers are significant and we question how they will complement the role of councillors. Residents elect councillors to, among other things, provide oversight of a council’s operations and budgets and they hold them accountable for this at every election. Consequently our members are concerned that there appears to be no effective role for councillors in the operation of the ARIC.
We are concerned that there is no limit on the number of meetings that can be called by the ARIC Chair and that this could result in significant cost imposts on councils who do not appear to be in a position to question the calling of additional meetings. There is nothing in place to control the ARIC once it is established.
Riverina JO Board Agenda and Papers 43 February 2020 The ARIC appears to have complete carte blanche to speak to whomever it wants, meet whenever it wants and use whatever council resources it deems necessary, as well as controlling the work of a senior council staff member, the CAE, and by extension whoever is providing support to the CAE. If the council and the ARIC end-up at loggerheads where is the resolution process? Who has precedence, the elected council or the ARIC?
In addition, the role of the CAE could be seen to take precedence over the General Manager. If the CAE demands information or work from a staff member who does the staff member answer to? If there are competing demands on the staff member’s time, which there inevitably will be, where is the direction that states that the General Manager is the sole arbiter of what takes priority. The Framework appears to be silent on this issue.
An example of the ARIC taking precedence over the council arises if the council decides to combine the CAE roles with Risk Management Co-ordinator’s role. The Framework requires that the ARIC endorse the proposal before the combined role can commence, this requirement undermines the authority of the council as the governing body. It is not an appropriate arrangement, this is a decision that should rest solely with the council, after consultation with the ARIC.
Our Members do not support the proposal that once every four years the ARIC is audited by an external auditor to determine its effectiveness. This is a task that should be undertaken by councillors, or a committee of council. In the proposed Framework councillors have no role; therefore they are independent of the ARIC. Consequently they should be in a position to review the operations of the ARIC in order to determine whether the investment they have made in its operation and all its supporting administrative arrangements have effectively and efficiently delivered outcomes for council.
We are also concerned that ARIC’s work appears to be duplicating some of the work already undertaken by the NSW Audit Office. There needs to be a clear delineation of boundaries between ARIC and the Audit Office.
Can you suggest any improvements to the proposed Framework? The Department should develop a framework that reflects the flatter operational structure of rural councils. The proposed Framework would work for large State agencies where staff are operating in multiple locations and there is minimal day-to-day interaction between the most senior staff and those charged with delivering the agency’s core objectives. Having another senior staff member, the CAE, running around the council requesting information from stretched staff on activities that have already been reported to their senior managers (who have then included the information in reports to councillors) is a duplication of oversight that will bring very little in the way of a return to council.
The application of the proposed Framework to Joint Organisations is completely inappropriate. Even in a shared arrangement, the Framework cannot work for a Joint Organisation. As stated above this is a Framework appropriate for a highly complex organisation, which the JOs are not. The imposition of this level of red tape on already stretched JOs will push many to breaking point. An organisation with one full-time staff member and an annual budget of less than $500,000, as is the case with most JOs in NSW, does not require the imposition of a complex internal audit function.
We strongly suggest removing the need for a CAE; this is an expensive new position that will be difficult to fill. The CAE cannot undertake Internal Audit activities on any council operations or services that he/she has held responsibility for in the last 5 years, which means that an existing
Riverina JO Board Agenda and Papers 44 February 2020 senior staff member cannot be moved over to the position on either a full-time or part-time basis. The position cannot be outsourced unless it is in a joint arrangement, and even then, it is likely that the best qualified person would still be drawn from the staff of one of the Member Councils. This would mean that the joint CAE could not have carriage over audits in the council from which he or she was original employed.
It has been suggested that the CAE position and the Risk Management Officer position could be combined, however our Members do not believe this is a feasible approach. The CAE position is clearly a senior management role, while the Risk Management Officer is not; in addition, we believe the skill sets required for each position are completely different.
The criteria that has been established for a position on the ARIC will almost certainly result in regional and rural councils having to recruit from a metropolitan area, this will significantly increase costs associated with travel and accommodation. The criteria for members of ARIC should be amended to allow councillors or staff from councils that have not served on the engaging council to serve on the ARIC. This would ensure that people who actually understood how Local Government works could be appointed to the ARIC. The current Australia-wide ban is completely unnecessary.
The criteria should also permit a person who has not, in the last 18 months, provided goods or services to the engaging council to serve on the ARIC. As it currently stands any accountant, lawyer or other consulting professional that has rendered services to the engaging council in the last 3 years cannot be considered. Given the limited pool of people available in rural areas this will restrict the ability of councils to recruit locally or even regionally.
There is a complete block on anyone that has previously acted as an advocate of a material interest on the behalf of the council or a related entity, again this seems extreme and should be restricted to a period of not more than 18 months. Our Members also believe that councillors from the engaging council should be permitted to serve as voting members on the ARIC. This would increase the transparency of the ARIC and providing independent members outnumber council appointed councillors should not cause any significant issues.
Finally our Members strongly advocate for the Government to consider alternative models of delivery of the audit function. A number of our Members already have audit regimes in place that are cost-effective and are delivering benefits to their councils. We believe that there is a lot that can be learned from these models that would reduce the complexity and cost of what is currently being proposed. We have included an outline of these models at Appendix B.
Summary
Our Members agree that it is not appropriate to apply the proposed Framework to the operation of Joint Organisations. The approach is far too complex and unwieldy for the JOs who commonly have only one or two staff members at most. The proposal if implemented will be unaffordable for most Joint Organisations.
In relation to the implementation of the Framework for the JO’s Member Councils, our Members agree that it is far too complex and expensive. It fails to recognise the flatter administrative structure that is common to most rural councils, and also fails to recognise the existing level of reporting that occurs between staff and councillors, which minimises risk. The benefits that will be derived from
Riverina JO Board Agenda and Papers 45 February 2020 the new Framework will not justify the costs of delivery. Even if our Member Councils were to share the burden, the costs would still exceed the benefits that are likely to flow from implementation.
The ARIC membership qualifications are far too narrow. The criteria should be reviewed to allow people who have recent experience in Local Government to serve on the ARIC. If the current criteria are approved, then rural and remote councils will be forced to engage people from metropolitan areas to serve on the ARIC who are likely to have had minimal exposure to rural and regional communities and are consequently likely to be less effective in the role. There are unique challenges that councils operating in a rural or remote areas face every day and it is essential that councils have the capacity to appoint people that have an understanding of those challenges.
In addition, engaging metropolitan based members will generate additional costs associated with travel and accommodation, while we appreciate there is an option for teleconferencing for ARIC, we believe in reality this will not occur given the nature of the work the ARIC is undertaking.
Our Members are concerned that the ARIC has far too much power to direct council staff and resources. There are no provisions for the resolution of issues between the ARIC and a council and more concerning the Framework does not acknowledge council as the governing body, ensuring its decision-making takes precedence over the ARIC.
Our Members agree that the same outcomes could have been achieved through the adoption of one of the alternative models that we have outlined in Appendix B. We recognise that the models we have put forward are only a small sample of what 70% of the councils in NSW are already doing. Our Members believe that it was open to the Government to analyse these models of operation particularly in rural and remote councils to develop a framework that was actually affordable and feasible for councils that are not located in a metropolitan location.
Our Members request that the proposed Framework be reviewed with the goal of developing a regime that will deliver benefits that equate to the cost of implementation, particularly for rural and remote councils. Our Members would welcome the opportunity to work with the State Government on the development of a more cost-efficient regime for rural and regional councils.
Riverina JO Board Agenda and Papers 46 February 2020 APPENDIX A 1. Single Council Operation – Estimated Costs EXPENSE ITEM COST Comments Chief Audit Executive Salary $ 150,000.00 On-costs $ 54,000.00 $ 204,000.00 Risk Management Officer Salary $ 90,000.00 On-costs $ 32,400.00 $ 122,400.00 Admin Support (PT) Salary $ 40,000.00 On-costs $ 14,400.00 $ 54,400.00 Other Costs Car $ 15,000.00 Phone $ 2,000.00 Office Miscellaneous $ 6,000.00 Printing etc $ 5,000.00 $ 28,000.00 TOTAL STAFF COSTS $ 408,800.00
ARIC Operation: Small Council (4 meetings per year + 1 Special Meeting for Financial Statements) Chairman $ 12,522.00 Members x 2 $ 12,550.00 Superannuation $ 2,381.84 Travel $ 6,750.00 5 meetings @$450 Accommodation and 5 Meetings x 1 night Sustainance $ 3,750.00 and 1 day @$250 Meeting costs $ 1,250.00 5 meetings 2 $250 TOTAL ARIC COSTS $ 39,203.84
ARIC Operation: Medium Council (4 meetings per year + 1 Special Meeting for Financial Statements) Chairman $ 16,213.00 Members x 2 $ 16,210.00 Superannuation $ 3,080.19 Travel $ 6,750.00 5 meetings @$450 Accommodation and 5 Meetings x 1 night Sustainance $ 3,750.00 and 1 day @$250 Meeting costs $ 1,250.00 5 meetings 2 $250 TOTAL ARIC COSTS $ 47,253.19
TOTAL COSTS OF PROPOSED FRAMEWORK: SMALL $ 448,003.84 COUNCIL TOTAL COSTS OF PROPOSED FRAMEWORK: MEDIUM $ 456,053.19 COUNCIL
Riverina JO Board Agenda and Papers 47 February 2020 2. Joint Operation: Estimated Costs
EXPENSE ITEM COST Comments Chief Audit Executive Salary $ 150,000.00 On-costs $ 54,000.00 $ 204,000.00 Risk Management Officer Coucils employ their internal position in each own RMO council
Admin Support (F/T) Salary $ 75,000.00 On-costs $ 27,000.00 $ 102,000.00 Other Costs Car $ 20,000.00 Additional Travel Phone $ 2,000.00 Office Miscellaneous $ 6,000.00 Printing etc $ 5,000.00 Total Other Costs $ 33,000.00 TOTAL COSTS $ 339,000.00
ARIC Operation: Joint Arrangement (4 meetings per year + 1 Special Meeting Joint arrangement will for Financial Statements) require 2 sitting days Chairman $ 20,920.00
Additional Member Members x 3 $ 62,760.00 added due to extra work Superannuation $ 7,949.60 Travel $ 6,750.00 Councils meet cost otherwise JO Accommodation and membership fees will Sustainance $ 7,500.00 rise More support required internally so F/T Meeting costs $ 1,250.00 position TOTAL ARIC COSTS $ 107,129.60
TOTAL COSTS OF PROPOSED FRAMEWORK: JOINT $ 446,129.60 APPROACH If JO contributes then Shared by 9 Members and JO $ 49,569.96 Membership fees rise to (but only councils pay) cover it. Plus Each Council engages a Risk Management Officer $ 122,400.00 Cost per Council $ 171,969.96
Riverina JO Board Agenda and Papers 48 February 2020 APPENDIX B
ALTERNATIVE MODELS FOR THE DELIVERY OF INTERNAL AUDITS
Model One: Internal Audit Alliance
An alliance of six councils have joined together to audit each other, the councils jointly share an Internal Auditor who sits as an independent on each Internal Audit Committee.
The Model has been operating successfully for over 10 years.
Structure Each council has its own Internal Audit committee and appoints its members according to the adopted Charter or Policy. The Committee is usually comprised of: • General Manager and a Director level staff member from one of the alliance member councils (independent members) • two councillors; and • an external independent auditor (the cost of which is shared across the alliance members).
Each council has adopted its own policy/charter for the Internal Audit Committee. The work of the Internal Auditor is supported by each Alliance council’s staff, for example the Manager of Business and Governance or the Manager of Corporate Services.
The Committee meets 4 times a year with each of the alliance members.
Risk Management Framework Modules or areas of investigation identified by the Internal Audit Alliance are investigated by the Internal Auditor, who then provides a series of recommendations. To date the following areas have been investigated by the Internal Auditor: • Legislative Compliance, • Fraud, • Delegations, • Policy, • Payroll and HR, • Procurement • Contract Management
The development of a Corporate Risk Register is currently underway and this will identify mitigation strategies and appropriate internal controls throughout the organisation. Risk mitigation controls will be considered during strategic planning and corporate plan development.
Reporting, Monitoring and Evaluation The Internal Auditor reports to the General Manager in the first instance. Internal Audit reports are presented to the Internal Audit Committee. The Internal Auditor speaks to the reports and responds to queries from the Committee. Management provide feedback and management responses are maintained on the Committee’s Status Report.
Riverina JO Board Agenda and Papers 49 February 2020 The Alliance has purchased the Pulse software program to manage the IA function and it has been installed. Monitoring and evaluation of the Internal Audit activities and those of the Committee are recorded in the Status Report
Cost of the Model to the Participating Councils The model costs each of the participating councils approximately $15,000-$20,000 per annum excluding staff time.
Outcomes achieved through the Process • Each module or area that has been investigated has resulted in improvements to processes, policy development and the creation of action plans to further manage existing risks. • The ARIC has heightened the awareness of the importance of risk management throughout the Alliance councils, identified existing gaps and areas of high risk and provided needed incentive to devote resources to the development of a risk management Framework. In an environment where resources are spread thin, risk management is not generally a top priority. The Committee has contributed to incorporating risk management within the regular business of Council.
Best features of the Model • The Internal Audit Alliance Model currently in place is suited for smaller rural Councils as costs are kept to a minimum and shared across the Alliance. • The identification and approach to the development of a risk management Framework is structured to accommodate small Councils. • While each Council within the Alliance is independently evaluated, the opportunity to actively network and share information with Councils of a similar size and risk profile is valuable and should not be underestimated.
Weaknesses of the Model • This model is reliant on a skilled Internal Auditor with a deep understanding of Local Government as well as effective management by Internal Alliance participants.
Model Two: Internal Audit Committee servicing a Single Council
This model operates within a single council that has made the decision to form an Audit, Risk and Improvement Committee (ARIC) and engaged independent committee members who have senior management experience, preferably in local government, financial skills and experience with internal audit and risk management systems.
The actual audits are undertaken by external providers who audit areas determined by the Committee.
The model has been successfully operating for over 5 years.
Structure The structure of the ARIC is as follows: • Independent Chair • Independent Member (1)
Riverina JO Board Agenda and Papers 50 February 2020 • Two councillors • Mayor attends in an ex-officio capacity. • Senior staff attached as observers/advisors
The Director of Corporate and Community Services is responsible for the ARIC and internal audit program in addition to all other aspects of the role. There is no other administrative support available. In addition Council has employed a full-time Risk Management Officer.
Council has adopted a Charter for the operation of the Committee.
Risk Management Framework Council has adopted a Risk & WHS Management System which consists of a set of program elements which include policies, planning activities, responsibilities, procedures and practices, processes and resources. The System consists of 4 elements:
1. Key policies and commitment - clearly stating the direction, intentions and commitment to risk management and continuous improvement. 2. Planning – developing a Risk & WHS Plan consistent with Council’s objectives. 3. Implementation – Council develops the capabilities and support mechanisms necessary 4. Evaluation and Management Review – performance is regularly reviewed at both the workplace and corporate levels to continually improve its overall Management System.
Reporting, Monitoring and Evaluation The external auditor conducts the audit in the areas selected by the ARIC. The completed audit reports are presented to the ARIC.
All recommendations from the internal audit reports are presented to the ARIC and maintained in an Audit Matrix. Progress on implementation of recommendations is updated in the Matrix and reported to ARIC quarterly.
Cost of the Model The annual budget $27,000 not including staff time, as follows:
ARIC operations including meeting fees: $ 7,000 Internal Audit Activities: $20,000
Outcomes achieved through the Process • Improved efficiency and better governance though the implementation of recommendations emanating from Internal Audit projects. • Direct cost savings in areas such as IT. • Improved confidence in financial reporting resulting from an independent assessment being undertaken by ARIC and reported to council in the annual financial statements.
Best features of the Model • Cost effective and achievable within current budget limitations and resource allocations. • ARIC membership is providing valuable input into financial management and governance matters.
Riverina JO Board Agenda and Papers 51 February 2020 Weakness of the Model • Implementation of recommendations from internal audit reviews is often outside current resourcing capabilities leading to increased pressure on staff. This is exacerbated when outstanding internal audit recommendations are highlighted through the external audit process and find their way into the final management letter issued by NSW Audit Office. When that happens, what was an internal matter becomes and external matter under the spotlight of NSW Audit Office resulting in even more pressure to implement something that is simply beyond the capability of the organisation.
Model Three: Internal Audit Committee servicing a County Council
This model operates within a single county council and is similar in operation to Model Two. The council has made the decision to form an Audit, Risk and Improvement Committee (ARIC). The model uses two independent members who have recent and relevant knowledge and experience in local government, accounting or finance, auditing, governance with internal audit and risk management systems.
The actual audits are undertaken by external providers who audit areas determined by the ARIC.
The model has been successfully operating since 2012
Structure The structure of the ARIC is as follows: • Two Independent Members • One councillor
ARIC meetings are attended by: General Manager Secretariat Support Governance and Records’ Officer Manager Corporate Services Manager Governance and Human Resources Other management as invited or required by ARIC
General Manager, Corporate Services, Governance and HR units provide support to ARIC and Internal Audit.
The ARIC has a charter which is adopted by Council.
Description of Risk Management Framework Structure • Governance and HR unit • Audit and Risk Committee meets 5 times per year • Internal Audit (contractor) • External Audit (State assigned) • Minimal staff resources allocated to risk management function
Policy and procedures
Riverina JO Board Agenda and Papers 52 February 2020 • Risk Management policy • Risk Management plan • Risk Management Action plan (6 monthly review) • Risk Register (6-month review with Executive Management team) – includes Councils risk criteria and treatment plans • Minutes of ARIC meetings are tabled at Council meetings following ARIC meeting • Internal audit work program developed every 5 years with 3 audits per year – contracted. Management response provided monitored and reported
Reporting, Monitoring and Evaluation The external auditor conducts the audit in the areas selected by the ARIC. The completed audit report is provided to the General Manager for response, there are 3 reports per year.
The internal report is provided to the ARIC for review and to provide feedback to management. The Internal Auditor attends the ARIC meetings. The ARIC reports to Council on progress and the implementation of corrective actions.
The ARIC provides an annual report to the County Council’s Board. The ARIC Charter makes provision for Internal Audit function to report annually against agreed KPIs.
An Audit Follow-up Plan is submitted to quarterly meetings. Data is recorded via Word documents and Excel spreadsheets retained on Council’s information management system.
Cost of the Model The annual budget $82,190 as follows:
ARIC Members, 5 meetings per year: $ 4,015 Three Internal Audits per year: $23,925 ARIC meetings and internal Auditor Attendance at 5 meetings per year: $ 4,250 Management Support Costs approx. $50,000
Outcomes achieved through the Process Currently practices appear to be effective. Most recommendations from audits have been positively accepted. This has resulted in improvements in practice, governance and compliance. Risks that have been identified by the internal audits have had controls applied to them resulting reduced risks.
External audits have resulted in the provision of an unqualified audit opinion on the annual financial statements
Best features of the Model • Overall principles are sound • Enterprise risk management provides more robust application • Increased community confidence in local government
Riverina JO Board Agenda and Papers 53 February 2020 Weaknesses of the Model • Excessive internal requirements regarding cost and control with significant human resourcing implications. • Trying to apply one size fits all across local government • Rate pegging will not allow for the implementation and operating costs for the IA function. • Arguably too much power rest with the Chief Audit Officer role
Riverina JO Board Agenda and Papers 54 February 2020 ATTACHMENT FIVE
ABN 66 746 462 096 PO Box 646, Wagga Wagga NSW 2650 Phone: 02 6931 9050 I Fox: 02 6931 9040 www.riveri nojo.nsw.gov.ou
17 January 2020
Dr Peter Boxall AO Chair Independent Pricing and Regulatory Tribunal PO Box K35 Haymarket Post Shop NSW 1240
Dear Dr Boxall
Inclusion of the Increased Costs of the Emergency Services Levy {ESL) and Local Government Elections in the Calculation of the Local Government Cost Index
I write on behalf of the members of the Riverina Joint Organisation in relation to the above matter.
Our Members, which are the councils of Bland, Coolamon, Cootamundra-Gundagai, Greater Hume Ju nee, Lockhart and Temora, are very concerned that the significant financial impacts of the substantially increased cost of both the ESL and Local Government elections, of which councils have no control, have not been adequately accounted for in the calculation of the 2020/21 rate peg.
Our Member Councils have calculated that a substantial proportion of the revenue that will be generated through the 20/21 rate peg of 2.6% will be eaten up by the increased expenditure on these two items. We provide the following information for your consideration:
Table One: Expected Increase in ESL Contributions
Increase in ESL ESL Total ESL Total Contribution in Member Councils Contribution Contribution "lfJ19/20 2018/19 2019/20 in $terms
Bland ______j ______375,955.00 - ~ --468, ~4.00 j_ ____ J 2,519.00 Coolamon** ___ 2_ __ 188,124.00 J__ __ 233,210.00 -2. . ·- 45,~. 00 Gundagai - - --- j___ 410,357.00 _i__ 505,419.00 j _---· 95,aJ200_ . Greater Hume ____ _i ----~12,379 . 00 j ___ 510,aJ9.00 J______97,690.00 Junee ____ .i____ 194,471.00 $ 240,227.00 2 .. _ 38,320.00 Lockha~ - - - ___ $ __ p 8,187.00 -~ _ 220~33 . 00 j ____ 42,746.00 Temora $ 236,494.00 $ 303,133.00 $ TOTAL FOR REGION $ 1,995,967.00 $ 2,481,465.00 $
Riverina JO Board Agenda and Papers 55 February 2020 STRONG REGIONS• PROGRESSIVE LOCAL GOVERNME N T• VIBRANT COMMUNITIES Table Two: Estimated Increase in Election Costs (based on NSWSEC estimates advised to councils)
· ·P~r~ntage Increase in LG . Election Costs Esi mtaed Cost Increase on .~ Member Councils Election Costs 2016 for 2020 ~-:;PreViou~ in $terms Payment.
Bland 65,329.00 __$ _ . ·----·- $ _ . 44,oo:l.OO $ ·---~!2~-.92 .48°/o Coolamon** $ $ $ , 49% ------·-·--- -· ~.~~-~ '.f5,~5-:
Table Three: Summary of Cost Impacts
~.:-;. Rate-pegged Increase in LG ,!1. ~~ge · lnaeasei:>n Revenue increase Member Councils Election Costs ;-· ....~" ~ ~ViOus for 1JJ1JJ/21 in$terms in$tenns Payment in $terms ).t; ~
- ~~~L ______~ .?. __?_!. 329.00_ .'.183 ~ 1~,00'.l-~ ·· ~m · .L . • 4g% q>Elam_E_n ~:_ ____ i i -- ~< !5?:-~ s 1?4·~: ~ 270% • .?. ~l_a_T undra_:§l ndag ~ $ -~2_3. 946.00 142% ~.Q_2Q:~ 270% .' -$ ~ - :- ~·· .'J. -- ~~-aterHu~ ---- ~ _IB,~:~ 50% s ~~- 00 270% , _? Ju..':!_~----·· __ S ?§.~-~ 58% s l~_?_C!:) . 00 270% s 1£_c_khart# ____ $_ '!_2, 7~~ 67% $ 65,200c~ _10,398.00 Temora $ 66,639.00 35,00'.l.OO 87% s 106,110.00 4,471.00 TOTAL FOR REGION $ 478,062.00 ' 242,799.00 ~ "_For Election Co~~'-":f~~C esti~~~es used os on election was not held in 2016 !f..!S!I _~ction Costs, 2016__Expen_!e !S bosed qn two conteste!f "'..C!!:cJ~· 2_9?~ ~ tif1!'!_te is quote In preparing the above table we have used the advised increase in ESL for 2019/20 assuming that this will be the minimum increase that will be asked for in 2020/21. The election costs that have been included are based on the advice received from the NSW Electoral Commission on the estimated cost of September 2020 elections. Our Member Councils understand and accept the following in relation to the Local Government Cost Index (LGCI) which is used by !PART to calculate the rate peg: • it is a measure of movements in unit costs incurred by NSW councils for ordinary council activities that are funded from general rate revenue; • it is designed to measure how much the prices change for a fixed "basket of goods" and services acquired by councils during a given period and compares that with the price of the same set of inputs for the base period; Riverina JO Board Agenda and Papers 56 February 2020 STRONG REGIONS• PROGRESSIVE LOCAL GOVERNMENT• VIBRANT COMMUNITIES • the basket of goods and services used by IPART is based on a survey of the NSW councils. The information is aggregated across the State to give each item a weighting based on its percentage share of councils' costs; • IPART refers to a set of identified price Indexes to decide how much the cost of the good or service has risen during the preceding period; • it does not measure the following factors: the effect of cost and price changes on an individual council's expenditure pattern, because the weights in the LGCI reflect the average spending pattern across all NSW councils; local price impacts eg, competition with local mining companies may cause higher wages for certain staff, or natural disasters may lift local building material prices; the effects of population growth; any council or community desires to increase the quality of existing services or provide new services or increase expenditure on infrastructure renewal. Therefore it does not take into account the need for a Council to implement the Community Strategic Plan; and depreciation or the cost of borrowing funds. As can be seen from the above table over 50% of the revenue raised through the rate peg will be consumed by the increases in the ESL and election costs. Our Members fail to understand how IPART has achieved its goals in relation to the LGCI, when this is the outcome. While we appreciate that the Local Government elections only occur once every 4 years, surely in a year when the elections are going to occur there should be an allowance in the rate peg for that expenditure. We note in its information on the 20/21 rate peg IPART stated that it had "included the forecast 2019-20 ESL costs that will be faced by councils as we are confident this is a robust estimate and it reduces the lag - between when councils face changes in ESL costs and when these cost changes are reflected in the rate peg - from two years to one year." While our Members applaud IPART's attempt to reduce the lag time in relation to the ESL and to make a robust estimate, it is clear from the above table that the process has not resulted in a positive outcome for councils. Our Member councils agree that the rate peg should be set independently by IPART through the LGCI because the process should provide the fairest and most accurate assessment of the increases that councils will need to accommodate "business as usual". However, our Member Councils agree that for the 20/21 rate peg, in relation to the ESL and the cost of Local Government elections, this has not been achieved. It is clear from the above table that our Member Councils will not be able to deliver "business as usual" in the 20/21 year because most of their increase in rates' revenue will be gobbled up by increased expenditures over which they have no control. Consequently, our Members believe that for the 20/21 year LGCI has not accurately measured the core operating costs of councils. Our Board is requesting information from IPART about how these increased costs will be accounted for the 21/22 rate peg calculations and whether IPART will Riverina JO Board Agenda and Papers 57 February 2020 STRONG REGIONS• PROGRESSIVE LOCAL GOVERNMENT• VIBRANT COMMUNITIES consider the lost revenue that has resulted in the failure of the 20/21 LGCI to properly reflect the substantial increases in core expenditures. We would welcome the opportunity to meet with you to discuss our concerns, please contact our Chief Executive Officer, Mrs Julie Briggs at the Riverina JO office who will make the necessary arrangements. We appreciate the time you have taken to give our correspondence due consideration. Chairman cc Hon John Barilaro, Deputy Premier Hon Shelley Hancock MP, Minister for Local Government Ms Steph Cooke MP, Member for Cootamundra Dr Joe McGirr MP, Member for Wagga Wagga Mr Justin Clancy MP, Member for Albury Hon Wes Fang MLC Mr Greg Warren MP, Shadow Minister for Local Government Hon Mick Veitch MLC Cr Linda Scott, LGNSW President Riverina JO Board Agenda and Papers 58 February 2020 STRONG REGIONS• PROGRESSIVE LOCAL GOVERNMENT• VIBRANT COMMUNITIES ATTACHMENT SIX Riverina JO Board Agenda and Papers 59 February 2020 Riverina JO Board Agenda and Papers 60 February 2020 Riverina JO Board Agenda and Papers 61 February 2020 MOBILE PHONE BLACKSPOTS ATTACHMENT SEVEN LGA Village Issue Comments In respect to elements of danger the poor coverage can place Bland Tallimba Mobile Blackspots lives at risk. If there is a farm accident, a motor vehicle accident or Bland Naradhan Mobile Blackspots even a medical emergency and a person cannot connect to any of Bland Mirrool Mobile Blackspots the emergency services than lives are put at risk. The medical Bland Weethalle Mobile Blackspots fraternity refer to the ‘golden hour’ the time in which it is critical that an injured or extremely ill person require treatment, After this first hour the risk of death is increased dramatically. The fact that many of the identified locations are many kilometres from any emergency service in the first place makes the need for good phone coverage essential Matong back south east toward Coolamon Derrain Poor coverage Ardlethan towards Beckom and Coolamon then south Consistent drop‐outs Ardlethan has a tower but suffers regular dropouts Reception in this area goes Cootamundra‐ from scratchy, to Large volumes of through traffic particularly heavy vehicles and Gundagai Coolac to Cootamundra Road intermittent, to non‐existent general freight Reception in this area goes Cootamundra‐ from scratchy, to Large volumes of through traffic particularly heavy vehicles and Gundagai Gundagai to Tumut Road intermittent, to non‐existent general freight High risk due to the village being situated on a state road and Greater Hume Carabost/Little Billabong Non‐existent coverage proliferation plantation pine forests in the area High risk due to the village being situated on Jingellic Road and Greater Hume Lankeys Creek Non‐existent coverage proliferation plantation pine forests in the area Greater Very intermittent mobile Hume/Wagga Wagga Road coverage Significant traffic volumes between Holbrook and Wagga Wagga Junee Harefield Scratchy coverage There is a lot of through traffic on Bomen Road Junee/Wagga Shepherd's Siding Scratchy coverage There is a lot of through traffic on Bomen Road Riverina JO Board Agenda and Papers 62 February 2020 MOBILE PHONE BLACKSPOTS Telstra put up a tower to fix the issue in the Wantabadgery village, however it does not cover the valley where the farming Farming Valley along land is. This affects the area between Junee/Nangus Road to Junee Wantabadgery Road Poor coverage Oura/Wantabadgery Road Lockhart Yerong Creek Absence of mobile coverage Safety concern because it is located along the Olympic Hichway Temora Bardmedman to Temora Mobile Blackspots Blackspots along the Goldfields Way Temora Springdale Patchy coverage Riverina JO Board Agenda and Papers 63 February 2020 ATTACHMENT EIGHT NSW JOINT ORGANISATIONS (JO) CHAIRS FORUM TERMS OF REFERENCE (GOVERNANCE AND OPERATIONAL ARRANGEMENTS) 1. Preamble Any meetings of the NSW Joint Organisations (JO) Chairs’ Forum are to be guided by this Terms of Reference. 2. Objective To meet as regional representatives of Joint Organisations to engage and exchange information on best practice and excellence in the pursuit of strategic regional priorities and collaboration activities to achieve value for the Joint Organisation network. 3. Role • To monitor implementation of the three statutory core functions of NSW Joint Organisations as being:- (i) Strategic planning and priority setting (ii) Intergovernmental relations (iii) Shared successes, leadership and advocacy • To identify opportunities for best practice, excellence and potential collaboration between the thirteen Joint Organisations 4. Membership The JO Chairs’ Network comprises the Chairs of the following thirteen (13) Joint Organisations proclaimed by the NSW Government during 2018:- (i) Canberra Region JO (viii) Namoi JO (ii) Central NSW JO (ix) New England JO (iii) Far North West JO (x) Orana JO (iv) Far South West JO (xi) Northern Rivers JO (v) Hunter JO (xii) Riverina and Murray JO (vi) Illawarra Shoalhaven JO (xiii) Riverina JO (vii) Mid North Coast JO 5. Meetings • The Joint Organisations Chairs’ Forum will meet at least three times per year or as required from time to time; • Meetings of the Forum shall be scheduled for March, August and November of each year and coincide with other Local Government related meetings or events • Meetings shall be held if possible at Parliament House in Macquarie Street, so as to facilitate engagement with the Premier, Deputy Premier, Ministers and Government Officials. • If a Parliament House meeting facility is not available, the Secretariat will arrange an alternative Sydney CBD venue; • For each meeting of the Forum, the Secretariat shall endeavour to arrange attendance by Parliamentarians and Government Officials relevant to the meeting’s business agenda; • The Secretary of the Department of Premier and Cabinet and the Chief Executive of the Office of Local Government (or their representatives) shall be invited to attend all meetings of the JO Chairs’ Forum. Riverina JO Board Agenda and Papers 64 February 2020 6. Convenor • The JO Chairs’ Forum shall appoint a Convenor for each meeting rotating across the regions; • The Convenor shall chair the meeting of the JO Forum. 7. Secretariat • The Executive Officer of the Joint Organisation from which the Convenor has been appointed shall carry out the administrative functions on behalf of the Forum for the nominated meeting, in liaison with the Office of Local Government. 8. Financial arrangements • Each Joint Organisation shall meet any expenses of its Chairs in attending meetings and other events associated with the conduct of the JO Chairs’ Forum. End of JO Chairs Forum - Terms of Reference Riverina JO Board Agenda and Papers 65 February 2020 ATTACHMENT NINE Created: 3/02/2020 11:25 AM Riverina Joint Organisation 81 Johnston Street Profit & Loss [Budget Analysis] WAGGA WAGGA NSW 2650 July 2019 To January 2020 ABN: 66 746 462 096 Email: [email protected] Budgeted Selected Period Income Member Contributions $40,000.00 $40,000.00 Interest $2,500.00 $119.21 Total Income $42,500.00 $40,119.21 Total Cost Of Sales $0.00 $0.00 Gross Profit $42,500.00 $40,119.21 Expenses General Expenses Secretarial Services $25,000.00 $12,121.68 PI/PL Insurance $5,000.00 $0.00 Travel $4,000.00 $239.73 Representations $7,000.00 $0.00 Meetings $6,000.00 $227.27 Projects & Planning $25,000.00 $0.00 Printing/Stationery/Postage $2,000.00 $1,064.43 Rent $9,800.00 $0.00 IT Maintenance/Website $5,000.00 $0.00 Car $8,500.00 $0.00 Equipment consumables $3,000.00 $0.00 Phone/Internet $5,000.00 $0.00 Audit/Accounts $20,000.00 $845.44 Establishment/Evaluation Costs $15,000.00 $0.00 Total General Expenses $140,300.00 $14,498.55 Payroll Expenses Wages & Salaries Expenses $83,200.00 $41,600.00 Workers Compensation Insurance $400.00 $1,329.26 Superannuation Guarantee $7,904.00 $3,952.00 Leave Expenses $2,080.00 $0.00 Total Payroll Expenses $93,584.00 $46,881.26 Total Expenses $233,884.00 $61,379.81 Operating Profit -$191,384.00 -$21,260.60 Net Profit/(Loss) -$191,384.00 -$21,260.60 Page 1 of 1 Riverina JO Board Agenda and Papers 66 February 2020 Created: 3/02/2020 11:26 AM Riverina Joint Organisation 81 Johnston Street Balance Sheet [Budget Analysis] WAGGA WAGGA NSW 2650 July 2019 ABN: 66 746 462 096 Email: [email protected] Budgeted Selected Period Assets Current Assets Bank Accounts Westpac 032769 764372 $218,355.70 $211,088.55 Total Bank Accounts $218,355.70 $211,088.55 Total Current Assets $218,355.70 $211,088.55 Total Assets $218,355.70 $211,088.55 Liabilities Current Liabilities GST Liabilities GST Paid -$4,750.90 -$4,896.69 Total GST Liabilities -$4,750.90 -$4,896.69 Payroll Liabilities PAYG Withholding Payable $3,042.00 $4,602.00 Employee Leave Provisions $3,235.99 $3,235.99 Total Payroll Liabilities $6,277.99 $7,837.99 Other Current Liabilities Trade Creditors $9,894.80 $8,792.67 Accrued Workers Compensation $188.41 $188.41 Total Other Current Liabilities $10,083.21 $8,981.08 Total Current Liabilities $11,610.30 $11,922.38 Non-Current Liabilities Payroll Liabilities Employee Leave Provisions $2,310.00 $2,310.00 Other Non-Current Liabilities Accrued Workers Compensation $134.50 $134.50 Total Non-Current Liabilities $2,444.50 $2,444.50 Total Liabilities $14,054.80 $14,366.88 Net Assets $204,300.90 $196,721.67 Equity Retained Earnings $205,167.90 $205,167.90 Current Year Surplus/Deficit -$867.00 -$8,446.23 Total Equity $204,300.90 $196,721.67 Page 1 of 1 Riverina JO Board Agenda and Papers 67 February 2020