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Realising the Port of Echuca Precinct Potential - Consideration of Options for the Future Management of the Port of Echuca Precinct

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Realising the Port of Echuca Precinct Potential - Consideration of Options for the Future Management of the Port of Echuca Precinct Campaspe Shire Council Realising the Port of Echuca Potential - Consideration of options for the future management of the Port of Echuca Precinct Report for Public Distribution August 2020 Realising the Port of Echuca Precinct Potential - Consideration of options for the future management of the Port of Echuca Precinct - Report for Public Distribution Contents EXECUTIVE SUMMARY ........................................................................................................................... 1 1. INTRODUCTION and BACKGROUND ............................................................................................... 21 1.1 Background ....................................................................................................................................... 21 1.2 Management Model Scenarios ......................................................................................................... 23 1.3 Report Scope and Content ................................................................................................................ 24 2. OVERALL BUSINESS FRAMEWORK AND STRUCTURE ....................................................................... 27 2.1 Business Objectives ........................................................................................................................... 27 2.2 Key Roles and Responsibilities .......................................................................................................... 28 2.3 Areas/Scope of Operations ............................................................................................................... 30 2.4 Legal and Governance Framework ................................................................................................... 37 2.5 Management and Organisation Structure ........................................................................................ 42 3. KEY BUSINESS MODEL and FINANCIAL PRINCIPLES and ASSUMPTIONS ........................................... 48 3.1 Key Principles and Assumptions – Business Model .......................................................................... 48 3.2 Key Principles and Assumptions – Financial Model .......................................................................... 49 4. FINANCIAL EVALUATION ................................................................................................................ 54 4.1 Financial Forecast Approach and Outputs ........................................................................................ 54 4.2 Forecasts ........................................................................................................................................... 55 4.3 Port Manager Model Scenario Adjustments..................................................................................... 58 4.4 Port Manager Options Financial Evaluation ..................................................................................... 59 4.5 Overall Financial Analysis Conclusion ............................................................................................... 65 5. FUTURE BUSINESS MODEL KEY RISKS ............................................................................................. 66 6. POTENTIAL FUTURE BUSINESS IMPROVEMENT OPPORTUNITIES ..................................................... 68 7. EVALUATION OF MODEL OPTIONS ................................................................................................. 71 7.1 Evaluation Framework ...................................................................................................................... 71 7.2 Key Differences between the Port Manager Model Options ........................................................... 75 7.3 Port Manager Option Evaluation ...................................................................................................... 78 7.4 Key Conclusions and Recommendations .......................................................................................... 84 7.5 Key Actions ........................................................................................................................................ 86 ACRONYMS .......................................................................................................................................... 87 Appendix A: Legal Structure Options – extracts of relevant Acts ............................................................ 88 Realising the PoEP Potential - Consideration of options for the future management of the PoEP Report for Public Distribution – August 2020 Page 2 Table of Figures Figure 1: PoEP Management Areas ................................................................................................................. 21 Figure 2: Base Case – Council Management Organisation Structure .............................................................. 43 Figure 3: NFP Manager Model Organisation Structure ................................................................................... 44 Figure 4: PoEP Integrated Manager Model Organisation Structure ............................................................... 45 Figure 5: Financial Forecasting Approach ........................................................................................................ 54 Figure 6: Base Case Operating Performance ................................................................................................... 56 Figure 7: Base Case Performance by Service Area .......................................................................................... 57 Figure 8: Base Case Cashflow by Service Area ................................................................................................ 57 Figure 9: Forecast Operating Performance by Scenario .................................................................................. 61 Figure 10: Forecast Cashflow by Scenario ....................................................................................................... 61 Figure 11: Base Case Operating Performance by Entity .................................................................................. 62 Figure 12: NFP Manager Model Operating Performance by Entity ................................................................ 62 Figure 13: PoEP Integrated Manager Operating Performance by Entity ........................................................ 62 Table of Tables Table 1: PoEP Management Areas .................................................................................................................. 22 Table 2: Identified Management Model Scenarios ......................................................................................... 23 Table 3: Project Scope ..................................................................................................................................... 24 Table 4: Port of Echuca Precinct Strategic Objectives ..................................................................................... 27 Table 5: Port of Echuca Precinct Port Manager Operational Objectives......................................................... 27 Table 6: Changes in Key Roles and Responsibilities across Port Manager Models ......................................... 28 Table 7: Changes in Scope of Operations across Port Manager Models ......................................................... 31 Table 8: Changes in Management Responsibility across Assets ..................................................................... 35 Table 9: Legal and Governance Frameworks ................................................................................................... 37 Table 10: Potential Legal Structures ................................................................................................................ 40 Table 11: Organisational Structure Principles ................................................................................................. 42 Table 12: Potential Staff Resourcing ............................................................................................................... 46 Table 13: Business Model principles and Assumptions ................................................................................... 48 Table 14: Financial Model Principles and Assumptions .................................................................................. 49 Table 15: Base Case Operating Performance and Cashflow ........................................................................... 56 Table 16: Base Case Operating Performance and Cashflow by Service Area .................................................. 57 Table 17: Financial Forecast Output Summary ............................................................................................... 58 Table 18: Total Comparative Operating Performance under different Structures ......................................... 60 Table 19: Total Comparative Cashflow under different Structures ................................................................ 60 Table 20: Comparative Operating Performance across individual Entities ..................................................... 62 Table 21: Sensitivity Analysis ........................................................................................................................... 63 Table 22: Expense Structure for a Typical Year ............................................................................................... 64 Table 23: Key Risks of Future Business Model Options ..................................................................................
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