Annual Report 2009–10

ANNUAL REPORT 2009–10

City of Melbourne Annual Report 2009–10

TABLE OF CONTENTS

Purpose of this annual report ...... 3 Measuring performance...... 3 City of Melbourne Vision, Mission and Values ...... 5 Vision...... 5 Mission...... 5 Values...... 5 Realising our vision ...... 6 Message from the Lord Mayor ...... 7 Message from the Chief Executive Officer...... 8 Spotlight on Lean Thinking and community engagement...... 9 Lean Thinking...... 9 Community engagement ...... 9 Some highlights for the year...... 11 PART ONE – AN OVERVIEW OF THE CITY OF MELBOURNE ...... 15 Melbourne, Australia...... 16 Melbourne, the place...... 16 Melbourne, the people ...... 17 Melbourne facts and figures ...... 17 Melbourne stakeholders ...... 17 Melbourne City Council ...... 18 The council’s role...... 18 Councillors’ profiles...... 19 The council’s decisions...... 22 Corporate governance ...... 24 City of melbourne, the organisation...... 32 Organisational profile ...... 35 Awards ...... 40 Events...... 41 PART TWO – OUR PERFORMANCE ...... 43 City of Melbourne performance ...... 44 Goal one – A city for people...... 45 Goal two – A creative city...... 51 Goal three – Economic prosperity...... 54 Goal four – A knowledge city ...... 57 Goal five – An eco-city...... 59 Goal six – A connected city...... 66 Goal seven – Lead by example ...... 68 Goal eight – Manage our resources well...... 70 City of Melbourne 2009–10 Performance Statement...... 73 Performance against Key Strategic Activities (KSAs)...... 73 Best value ...... 99 Victorian Local Government Indicators ...... 102 About the Global Reporting Initiative...... 103 GRI content table...... 104 PART THREE – FINANCIAL STATEMENTS...... 106

City of Melbourne Annual Report 2009–10

PURPOSE OF THIS ANNUAL REPORT

This annual report documents the City of Melbourne’s performance over the 2009–10 financial year against the eight goals of Council Plan 2009–13 and the 2009–10 Annual Plan and Budget. It includes issues that impact on the sustainability of our municipality and our organisation and outlines our sustainability performance.

The report comprises three main parts. The first part provides an overview of the City of Melbourne and the communities we serve (see page 15). The second part includes highlights of our performance against the Council Plan 2009–13 goals and details of our performance against the key strategic activities of the 2009–10 Annual Plan and Budget (see page 43). It also outlines our performance against strategic and global reporting indicators. The third part includes our financial statements (see page 107).

As part of our commitment to environmental sustainability, the City of Melbourne has printed a summary-only version of the annual report. The full annual report is available online at www.melbourne.vic.gov.au or by contacting 03 9658 9658.

The annual report meets our obligations under Section 131 of the Local Government Act 1989 (Vic) and the requirements of the Global Reporting Initiative (GRI) framework for sustainability reporting. Measuring performance

Success is measured by our performance against the goals of our Council Plan 2009–13 which align directly with the goals of the Future Melbourne Community Plan. Future Melbourne’s ambitious goals inspire us to improve the liveability and sustainability of our municipality. The Annual Plan and Budget 2009–10 set the actions and results for the financial year.

Strategic indicators have been set to monitor progress against our Council Plan 2009–13 and performance against these indicators is outlined within the second part of this report.

The United Nations Global Compact

The City of Melbourne was the first local government in the world to align with the United Nations Global Compact’s 10 guiding operational principles covering human and labour rights and environmental protection. The City of Melbourne takes a collaborative approach to addressing the social, environmental and economic challenges facing our municipality and continues to support the development of the United Nations Global Compact Cities Program.

Sustainability reporting

Melbourne is a recognised leader in the field of environmental sustainability. We aim to improve the sustainability of the municipality’s building stock, reduce carbon emissions, develop ways to capture, store and deliver potable water, better manage and improve the disposal of waste, and respond to the potential effects of climate change.

We follow the Global Reporting Initiative’s sustainability reporting guidelines, which provide a framework to measure, track, report on and compare economic, environmental and social performance. The Global Reporting Initiative (GRI) is an independent program that provides one of the world’s most widely used standards for sustainability reporting.

The GRI index (see page 105) shows where we have reported against the GRI’s sustainability guidelines in this document.

City of Melbourne Annual Report 2009–10

We want your feedback

Residents, ratepayers, businesses, visitors, staff, partners and collaborators, sister cities, government departments and community agencies are all affected by the City of Melbourne’s decisions. To improve our reporting on our performance, we are keen to hear your thoughts on this annual report. For more information and to provide feedback, please visit www.melbourne.vic.gov.au or phone us on 03 9658 9658.

City of Melbourne Annual Report 2009–10

CITY OF MELBOURNE VISION, MISSION AND VALUES Vision

The City of Melbourne will strive to achieve the community’s vision of a bold, inspirational and sustainable city.

Mission

The City of Melbourne will strive to achieve the community’s vision of Melbourne as a bold and inspirational and sustainable city by:

• Making Melbourne great for people to live in and visit • Achieving the creative potential of the city • Protecting and strengthening the city’s economic prosperity • Making Melbourne a recognised knowledge city that supports innovation and technology • Demonstrating leadership in ecological sustainability • Working vigorously for a connected city which is safe and supports the efficient movement of people and freight • Leading by example and managing resources well.

Values

For City of Melbourne employees and councillors to be the best at what they do and achieve the corporate vision and mission, their actions and decisions are guided by a set of five fundamental and unifying values; integrity, courage, accountability, respect and excellence.

Integrity: We take responsibility for our actions in an honest and transparent way

Courage: We dare to create new and better ways of doing business

Accountability: We take responsibility for decisions and actions to achieve agreed outcomes

Respect: We consider and understand the perspective and contribution of others

Excellence: We continuously improve our performance to achieve outstanding outcomes for Melbourne.

City of Melbourne Annual Report 2009–10

Realising our vision

Our Council Plan 2009–13 identifies eight goals that will guide us towards our vision.

Our aspirations for the city are reflected in the first six goals. Our municipality will become:

1. a city for people

2. a creative city

3. economically prosperous

4. a knowledge city

5. an eco-city

6. a connected city.

A further two goals relate to our internal performance and give direction for the good governance and management of our organisation. The City of Melbourne will:

7. lead by example

8. manage our resources well.

City of Melbourne Annual Report 2009–10

MESSAGE FROM THE LORD MAYOR OF MELBOURNE

The past 12 months have been an exceptional time for Melbourne.

Prudent financial management means the council is on track to deliver $1.3 billion in programs and services and around $250 million in capital expenditure during our term.

Our annual report highlights the council’s priorities and key strategies.

We are delivering.

We are redeveloping Swanston Street to become a world class promenade; working with a range of parties and agencies to improve city safety; supporting vulnerable members of our community; and creating opportunities for Melbourne in retail, hospitality, tourism and events.

We are working to protect and enhance our city for our 93,000 residents as well as the nearly 800,000 people who come into the city each day and the more than 300,000 people who visit our city each night.

Melbourne is an international player in sustainability. Our landmark 1200 Buildings program launched earlier this year will generate around $2 billion in private sector investment and create around 8000 jobs over the life of the program.

We are planning now for the development of our city through to 2050. Specifically, we have started a series of community consultations for Docklands Second Decade, the Municipal Strategic Statement and the Southbank Structure Plan.

Melbourne people will see more of this comprehensive style of consultation as we increasingly invite the community to be more actively involved in shaping the future of our city.

The Victorian Government has recognised our success and introduced new shared planning arrangements for buildings over 25,000 square meters. Also, the City of Melbourne is now the responsible authority for the developed areas of Docklands.

This year marks the 175th anniversary of our great city. Today Melbourne has a global reputation as a city of arts and culture, education, knowledge, dining, shopping and of course great sports events.

We are proud and excited to be shaping the future of our great city with all those who feel passionate about our city as I do.

Robert Doyle

Lord Mayor

City of Melbourne Annual Report 2009–10

MESSAGE FROM THE CHIEF EXECUTIVE OFFICER

The 2009–10 financial year has been a busy and exciting period for the City of Melbourne. The council has played a major role in shaping the city environmentally, socially and economically at a critical time for Melbourne. Our events, arts, design, sustainability, planning and organisational management activities have been recognised on national and international stages.

We delivered over 85 per cent of the 109 activities and initiatives contained in the council’s Annual Plan 2009–10 to 80 per cent or more complete. We also completed 100 per cent or close to it on almost all of the 11 key strategic areas identified by the council as high priorities, while still delivering an underlying surplus of $15 million. The highlights of these achievements are contained in the pages of this report.

The City of Melbourne’s key focus – driving organisational efficiencies – has reaped great results this year too. The implementation of a Lean Thinking program has successfully delivered productivity gains, customer satisfaction, savings and more than $1 million additional revenue for the financial year. We are expanding the program to improve more streams of work into the next financial year.

In 2009–10 we delivered a new Community Engagement framework to guide and strengthen our consultation with communities and developed a Customer Focus Strategy, a three year plan to improve our service systems, processes and delivery. Furthermore our staff are trained and equipped with the skills required to deliver it.

I am pleased to report that our customers are telling us that we’re doing a good job. The government’s annual survey of residents’ perception of our services shows us that our overall performance is higher than other Victorian councils. We also set the benchmark in local roads and footpaths, recreational facilities and economic development and support. It also shows that our efforts in community engagement are paying off as our scores in this area have improved since last year. We will use the survey results to monitor our improvement efforts in those areas where the scores were not as good.

Our internal Culture Survey once again demonstrated that we have a motivated workforce committed to the success of the City of Melbourne and who are prepared to go above and beyond to achieve our community’s goals and objectives. The survey results have improved each year for the three years of the survey and the response rate from staff continues to increase. Furthermore, the City of Melbourne was once again recognised as a model best practice employer by winning the Victorian Government Fair and Flexible Employer Recognition Award 2010. We will continue our efforts in ensuring that the City of Melbourne can attract and retain the best people.

The partnership between the council and the staff is the key to our success. I would like to take this opportunity to personally thank the council for its guidance in setting a strong and inspirational plan for the City and City of Melbourne staff for their commitment to that plan and to Melbourne.

Dr Kathy Alexander

Chief Executive Officer

City of Melbourne Annual Report 2009–10

SPOTLIGHT ON LEAN THINKING AND COMMUNITY ENGAGEMENT Lean Thinking

Lean Thinking is an improvement system which focuses on improving the quality, timeliness and cost of services we deliver from the perspective of the customer. The system provides a structure, techniques and tools for carrying out improvements. Its ultimate goal is to deliver increased satisfaction for our customers and staff. The City of Melbourne has been a pioneer in local government in Australia, fully embracing Lean Thinking as the continuous improvement model.

Lean Thinking within the City of Melbourne began in 2009, focussing on 10 organisational processes, incorporating many areas of the business including parking meters, child care, council reports and the recruitment process. One example of these improvements was the processing of construction zone permit applications. Prior to the application of Lean Thinking principles, the City of Melbourne took months to go through all the processes necessary to issue these permits. After applying Lean Thinking, the time has been reduced to around a fortnight. This is not only a major improvement for customers applying for permits, but also for drivers needing parking spaces, as the spaces are reinstated much earlier. In our childcare centres, the Lean Thinking project identified 60 per cent of payments were overdue at any one time. A more customer friendly online process has increased timely payments and freed staff from administration work to focus on more time on the children.

In 2009–10, the City of Melbourne Lean Thinking program has been coordinated by a dedicated team who provide guidance and support to managers. Our aim is to increase customer and staff satisfaction with improved services and processes, increase first time quality and timeliness, reduce costs and reduce the environmental impact. All process improvements must be measured against these outcomes.

In 2010–11, the City of Melbourne will continue to apply Lean Thinking across the organisation. Our aim is to transform our organisational culture such that Lean Thinking is the way things are done every day. Lean Thinking will be prevalent across the organisation, evidenced by supportive leaders who work with their teams to solve problems through the application of lean techniques. Because Lean Thinking focuses on processes from beginning to end we are also working with our external partners to ensure seamless service delivery for the benefit of our customers. Community engagement

A better engaged community will result in improved policies and services that reflects the community’s needs and aspirations. The City of Melbourne is committed to improving the way our community is informed and involved in the decision making process. This year we developed a community engagement framework to guide our activities.

The organisation has a dedicated community engagement team who ensures that community engagement activities are aligned to the framework.

City of Melbourne Annual Report 2009–10

Within the past year, nearly 200 City of Melbourne staff participated in community engagement training. A further 20 staff members participated in advanced training with the International Association for Public Participation (IAP2). The City of Melbourne uses the association’s tools and resources to support its work and is guided by the association’s core values for public participation. For further information about the IAP2 core values, visit www.iap2.org

Our efforts to improve the way we engage our community are reflected in our Community Satisfaction survey results this year. They indicate an improvement in the community’s perceptions about how we engage them.

City of Melbourne Annual Report 2009–10

SOME HIGHLIGHTS FOR THE YEAR

This section provides a summary of our achievements. Additional detail on each of these achievements and other highlights are provided in section two of this report.

Our Goals Highlights from 2009–10 Looking Ahead to 2010–11

City for people City safety Guided by the City of Melbourne’s To improve late night safety for city patrons, this year council installed two Community Infrastructure enhanced safe city taxi ranks at Queen Street and Flinders Street Station, St Kilda Implementation Framework, a Road. Safer ranks mean that passengers can now wait for a taxi in a well-lit, secure number of community infrastructure area of the city For further information about our city safety initiatives, see page 47. works will begin in 2010–11. Projects include design of the new Docklands library and upgrade Caring for our Children and Youth works at Kensington Town Hall. This year, two plans were developed to cater for the present and future needs of our Further information about children and youth. Designed to complement one another, the Children’s Plan community infrastructure works can 2010–13 caters for children up to the age of 12, and a Young People’s Policy is a be found on page 49. plan for young people aged 12 to 25 years. Further information about these plans can be found on page 46.

A creative city Signal arts facility Creative Spaces The Signal youth arts studio, an older sibling to Art Play, was launched in February Creative Spaces is a City of 2010. Purpose built for people aged 13 to 20, the studio provides opportunities for Melbourne program established to Melbourne’s youth to work with professional artists across all art forms and is a assist artists and arts organisations place for making, showing, inspiring and developing our city’s new creative talents. to move to or stay within the Further information about the Signal arts studio can be found on page 51. municipality. Further information about Creative Spaces initiatives can be found on page 53. Arts House Partnership funding awarded to the City of Melbourne for Arts House Special Projects such as the Black Arm Band has increased by 98 per cent for 2009–10. A total of $1.9 million in external funding was secured, primarily due to partnerships

City of Melbourne Annual Report 2009–10

with the Fred Hollows Foundation, Playing Australia, Major Festivals Initiative, Melbourne International Arts Festival, Vic Health, British Council, Arts Victoria and the Australia Council for the Arts. Further information about Arts House can be found on page 52. Economic Enterprise Melbourne Projects to support economic prosperity A new economic development program was launched in September 2009. The new prosperity Enterprise Melbourne program not only promotes and facilitates economic The City of Melbourne will continue development, it also provides a single point of entry for information relating to to strengthen our local economy business and economic activity. Further information about Enterprise Melbourne through a number of new initiatives can be found on page 54. including the implementation of a Music Support Strategy and the International Engagement Events in the city Framework. Further information on City of Melbourne events are a key way to engage the city in support of city these strategies can be found on businesses and contribute to our reputation as the events capital of Australia. In page 56. addition to our regular events calendar, the council has allocated additional funding to events such as Moomba, New Years Eve in the city and Melbourne Spring Fashion Week. Further information about events in our city can be found on page 56. A knowledge city International student program The third World Knowledge The City of Melbourne hosted a number of events this year aimed at enhancing the Cities Summit health, wellbeing and safety of international students who live in, work in, study in or The third World Knowledge Cities visit our city. Programs included the International Student Tourism Volunteer Summit will be held in Melbourne Program and the Melbourne Student Welcome event. Further information on these from 16–19 November 2010. This programs can be found on page 57. summit will enhance Melbourne’s reputation and showcase how Melbourne has progressed as a successful Knowledge City. Further information about the third World Knowledge Cities Summit can be found on page 57.

City of Melbourne Annual Report 2009–10

An eco-city 1200 Buildings Program New tree plantings The commercial building sector accounts for 48 per cent of all greenhouse gas Drought proofing work will continue emitted across the City of Melbourne. As one of the primary sources, the City of in 2010–11 as part of the City of Melbourne has launched the 1200 Buildings Program. The program aims to Melbourne’s climate change improve the environmental performance of 1200 buildings by an estimated 38 per adaptation program. Under this cent, thereby reducing greenhouse gas emissions by a potential 383,000 tonnes per program, $5.7 million has been year. Further information about the 1200 Buildings Program can be found on page allocated to commence further 59. stormwater harvesting works in the Fitzroy Gardens, enhancing the protection of Melbourne’s drought Drought-proofing Melbourne’s parks and gardens ravaged trees and to develop new Drought has continued to affect many of Melbourne’s parks and gardens. This year landscapes and streetscapes that the City of Melbourne has implemented drought-proofing initiatives in six of our are more suited to future climate major parks and gardens. To learn more about these initiatives see page 59. conditions.

A connected city Revitalising Swanston Street Review of the Melbourne Swanston Street is one of the city’s busiest streets running through the central city. Transport Strategy The City of Melbourne has sought feedback from key stakeholders on how we could In 2006 the municipal transport revitalise Swanston Street into a more attractive and accessible street. Delivered in strategy, Moving People & Freight, a staged approach, the City of Melbourne will begin stage 1 in 2010–11. was developed to guide the council’s decision making regarding improved mobility and access to New bike pod facility and around the City of Melbourne. Melbourne’s first bike pod, providing public shower and change facilities for cyclists The City of Melbourne will review who ride into the city each day, was launched this year. The bike pod, located at this strategy in 2010–11 to ensure the City Square car park, will overcome the shortfall of change and storage facilities Melbourne is well placed to deal for cyclists in the city. Further information about the new bike pod can be found on with some of the big challenges page 66. facing the City over the next 20 years.

City of Melbourne Annual Report 2009–10

Lead by example Recognising our achievements City of Melbourne, a centre for learning excellence The City of Melbourne received numerous acknowledgments and awards for excellence and innovation this year. In particular, we were awarded the 2009 In order to expand our current Victorian Government Fair and Flexible Employer Award and the 2009 International service provision, the City of Education Association of Australia Award for the 2009 Welcome to International Melbourne will develop a feasibility Students. A list of all our acknowledgments and awards from 2009–10 can be study to investigate the opportunity found on page 40. to create a centre for learning excellence as a Registered Training Organisation. Further information Transforming Australian cities study about this initiative can be found on Delivered in partnership with the Victorian Department of Transport, a long term page 69. strategic population study and report was completed this year. The Transforming Australian Cities report outlines options to transform metropolitan Melbourne to accommodate the projected population of five million by 2029. Further information about Transforming Australian Cities can be found on page 68. Manage our Customer focus strategy Lean Thinking program for resources well This year the City of Melbourne introduced a new Customer Focus Strategy, 2010–11 outlining our commitment to being a leading customer-focused organisation. By In 2010–11 the Lean Thinking engaging with the community, delivering simplified processes and exceeding program will focus on expectations, we are committed to high quality customer service guided by our organisational wide culture change. corporate values, and our customers’ needs and preferences. Further information We will focus on improving about our Customer Focus Strategy can be found on page 70. processes involving contractors and our own staff to ensure seamless services to our customers. Zero based budgeting

In 2009–10, the City of Melbourne introduced a new zero based approach to budgeting. As an introductory year, it was prudent to limit the scope to four branches. The positive results that came from zero based budgeting included enhanced transparency of the council’s expenditure, detailed justifications for budget allocations and an increased level of savings. Given the positive outcomes, the council is looking to continue with zero based budgeting next year. This approach to budgeting is another way that council works to ensure a financially well managed organisation.

City of Melbourne Annual Report 2009–10

PART ONE An overview of the City of Melbourne

City of Melbourne Annual Report 2009–10

MELBOURNE, AUSTRALIA Melbourne, the place

Melbourne is the capital of Victoria and Australia’s second largest city. It sits on the south-east edge of our continent on the shores of one of the world’s largest bays, Port Phillip Bay.

The municipality of Melbourne has a residential population of about 93,000 and covers 37.6 km2. It is the anchor of the much larger Melbourne metropolitan region which has a population of four million people and spreads more than 40 km to the south, 30 km to the east and 20 km to the north.

City workers and visitors swell the municipality’s population to around 770,000 during week days and on weekend evenings more than 300,000 people visit the city.

Melbourne is the gateway to Victoria, the seat of the Victorian Government and a major city in the global economy. It has a strong export focus and is a leader in education, retail and major events.

The municipality has changed dramatically over the last decade with over 100 new commercial and residential buildings added, including extensive development at its waterfront suburbs, Docklands and Southbank.

Melbourne offers the best of many worlds with magnificent tree-lined boulevards, a mix of classic and modern architecture and a unique blend of Asian and European style. Melbourne is consistently ranked as one of the world's most liveable cities by the Economic Intelligence Unit.

City of Melbourne Annual Report 2009–10

Melbourne, the people

The municipality of Melbourne has approximately 93,000 people and is culturally, very diverse. Just under half the residents were born overseas or have at least one parent born overseas. A third speak a language other than English at home with Mandarin the most common language spoken.

The city also has the youngest population of the wider Melbourne metropolitan area, with a median age of 28 years. Almost 30 per cent of residents are aged between 25 and 34 years. More than 18,000 of our residents are international students.

Melbourne facts and figures

• Median house price: $790,500 (March 2009) • 145,000 café and restaurant seats for diners • More than one million international visitors per year • 568 hectares of parkland • 16,800 businesses located in the city • Key industry sectors: advanced manufacturing, biotechnology, finance and business services, environment services, creative industries, higher education, information and communication technology, hospitality and retail.

The City of Melbourne’s extensive research program has a large collection of statistics, maps, area profiles and other information about Melbourne. Visit www.melbourne.vic.gov.au for more details.

Melbourne stakeholders

Our stakeholders include anyone with an interest in what we do and the services and programs we provide. They are:

• our local community, including residents, ratepayers, businesses, workers, students, visitors, unions, the media, community groups and associations, the education sector and other local government authorities • our working partners, including other government bodies and agencies, our suppliers and consultants, neighbouring communities, the business community and others • our global partners, including our city partners, investors, event organisers and others.

We work with stakeholders in many ways. Our community engagement framework guides the way we communicate with our stakeholders, from how we conduct formal consultations on significant policies (see page 69), programs and services, to specific issue advisory groups and our daily interactions with those who use our services and facilities. These interactions provide an important insight into how we can continue to improve the quality of our services.

City of Melbourne Annual Report 2009–10

MELBOURNE CITY COUNCIL

Melbourne City Council is the local government body responsible for the municipality of Melbourne. The council consists of a Lord Mayor and Deputy Lord Mayor (the leadership team) and seven councillors.

Under the provision of the City of Melbourne Act 2001 (Vic):

• Melbourne is not divided into wards • The leadership team is elected separately from councillors • The preferential voting system is used to elect the leadership team and proportional representation is used to elect councillors.

The current council was elected for a four year term in November 2008. The next council election is scheduled for November 2012. Further information about local government elections is available from the Victorian Electoral Commission at www.vec.vic.gov.au

The council’s role

The Local Government Act 1989 (Vic) sets out the primary purposes and objectives of Melbourne City Council and defines its functions and powers. The council is a public statutory body incorporated under the Act. Its role is to govern the municipality of Melbourne in service of the community.

The council:

• acts as a representative government and considers community needs when making decisions • establishes strategic objectives for municipal services and monitors their achievement • ensures the responsible and accountable management of the City of Melbourne’s resources • advocates local community interests to other communities and governments • is a responsible partner in government, taking the needs of other communities into account • fosters community cohesion and encourages participation in civic life.

City of Melbourne Annual Report 2009–10

Councillors’ profiles

Lord Mayor Robert Doyle

First elected in 2008.

The Lord Mayor is Chair of meetings of the Melbourne City Council and represents the City of Melbourne on the following advisory committees and external organisations:

• Council of Capital City Lord Mayors • Shrine of Remembrance • Australian Council of Local Government Steering Committee • Lord Mayor’s Charitable Foundation • Enterprise Melbourne Advisory Board • 1200 Buildings: Melbourne’s Building Retrofit Project Steering Committee • Audit Committee • Business Partner City Network • C40 Cities Climate Leadership Group • Cancer Council of Victoria • International Council for Local Environmental Initiatives (ICLEI) Australasian Mayors Council for Climate Protection Co-ordination Committee (Councillor Oke represents the Lord Mayor as proxy) • Melbourne Arts Trust.

Deputy Lord Mayor Susan Riley

Served as Deputy Lord Mayor, 2001–04. Re-elected in 2008.

The Deputy Lord Mayor is Deputy Chair of the Future Melbourne Committee and represents the City of Melbourne on the following advisory committees and external organisations:

• Audit Committee • Inner South Metropolitan Mayors’ Forum • Major Projects Advisory Committee • Melbourne Awards Advisory Board • Melbourne Arts Trust • Melbourne Retail Advisory Board 2009–12 (Deputy Chair) • Melbourne Spring Fashion Week Advisory Board (Deputy Chair) • Moomba Advisory Board • Police Community Consultative Committee – Central Activities District • Procurement Australia • Shine of Remembrance – Remembrance Day Dinner Committee • Lady Mayoress’ Committee (Acting Chair) • Enterprise Melbourne Advisory Board.

City of Melbourne Annual Report 2009–10

Councillor Peter Clarke

First elected in 2004 and re-elected in 2008.

Cr Clarke is Chair of the Future Melbourne (Planning) Committee and is the council’s representative on the Inner Melbourne Action Plan Implementation Committee. Cr Clarke represents the City of Melbourne on the following advisory committees and external organisations:

• Central City Standing Advisory Committee • City Licensing Approvals Forum • Hoddle Street Study Stakeholder Advisory Group • Inner South Metropolitan Mayors’ Forum • Major Projects Advisory Committee.

Councillor Carl Jetter

First elected in 2004 and re-elected in 2008.

Cr Jetter is Chair of the Future Melbourne (Economic Development and Knowledge City) Committee and currently represents the City of Melbourne on the following advisory committees and external organisations:

• City Licensing Approvals Forum • Melbourne Day Committee • Melbourne Hospitality Advisory Board 2009–12 • Moomba Advisory Board • Melbourne Awards Advisory Board • Enterprise Melbourne Advisory Board

Councillor Jennifer Kanis

First elected in 2008.

Cr Kanis is Chair of the Future Melbourne (People and Creative City) Committee, Deputy Chair of the Future Melbourne (Planning) Committee and represents the City of Melbourne on the following advisory committees and external organisations:

• Disability Advisory Committee • Family and Children’s Advisory Committee • Housing Choices Australia • Indigenous Advisory Panel • Melbourne Music Steering Committee • Melbourne Symphony Orchestra • Parks and Gardens Advisory Committee • Queen Victorian Market Sub-Committee • Central City Standing Advisory Committee (alternate).

City of Melbourne Annual Report 2009–10

Councillor Kevin Louey

First elected in 2008.

Cr Louey is Chair of the Future Melbourne (Connected City) Committee and Co-Chair of the Docklands Co-ordination Committee. Cr Louey also represents the City of Melbourne on the external Metropolitan Transport Forum.

Councillor Cathy Oke

First elected in 2008

Cr Oke is Chair of the Future Melbourne (Eco-City) Committee, Deputy Chair of the Future Melbourne (Connected City) Committee, Deputy Co-Chair of the Docklands Coordination Committee and represents the City of Melbourne on the following advisory committees and external organisations:

• Bicycle Reference Group • ICLEI Australia/New Zealand Oceania Board • ICLEI Executive Committee • Melbourne Music Steering Committee • Metropolitan Waste Management Group • Moonee Ponds Creek Coordination Committee • Parks and Gardens Advisory Committee • Queen Victoria Market Sub-Committee • Victorian Road Based Public Transport Advisory Council • Water Reference Group • Yarra Park Advisory Committee.

Councillor Ken Ong

First elected in 2008.

Cr Ong is Deputy Chair of the Future Melbourne (Economic Development and Knowledge City) Committee, Deputy Chair of the Future Melbourne (Finance and Governance) Committee and Deputy Chair of the Future Melbourne (People and Creative City) Committee. Cr Ong also represents the City of Melbourne on the following advisory committees and external organisations:

• Committee for Melbourne • Community Infrastructure Working Group • District Precinct Program 2007–10 • Litter Advocates Group • Major Projects Advisory Committee • Metropolitan Waste Management Group • Moomba Advisory Board.

City of Melbourne Annual Report 2009–10

Councillor Brian Shanahan

First elected in 2004 and re-elected in 2008.

Cr Shanahan is Chair of the Future Melbourne (Finance and Governance) Committee, Deputy Chair of the Future Melbourne (Eco-City) Committee and currently represents the City of Melbourne on the following advisory committees and external organisations:

• Vice President Association of Bayside Municipalities • Audit Committee • Major Projects Advisory Committee • Melbourne Arts Trust • North Melbourne Recreation Reserve Landscape Plan Advisory Committee • Queen Victoria Market Sub-Committee • Victorian Local Governance Association.

The council’s decisions

Councillors make decisions at council meetings and delegated committee meetings. Committee meeting decisions are subject to a ‘referral notice process’ meaning that where fewer than five committee members vote in favour of a motion, members have the option of referring the matter to the next council meeting for decisions.

Delegations

Melbourne City Council’s powers under the Local Government Act 1989 (Vic) or any other Act may be delegated to a council committee, to the chief executive officer (CEO) or to a City of Melbourne officer via the CEO. Staff members are accountable to the CEO. The council and its committees provide policy and staff members make decisions in accordance with that policy. The exercise of delegation is subject to the council’s Delegations Policy.

Relationship with other tiers of government

Statutory responsibility for local government lies with each Australian state or territory. An Act of each state parliament specifies local government powers, duties and functions. In Victoria, the legal basis for councils is established under the Constitution Act 1975 (Vic) and the Local Government Act 1989 (Vic).

Subsidiaries and trusts

The City of Melbourne has three wholly owned subsidiaries:

• CityWide Service Solutions Pty Ltd, a company established to provide contract services on a competitive basis to local government and other public and private sector clients • Queen Victoria Market Pty Ltd, a company established to manage and develop the Queen Victoria Market • Melbourne Wholesale Fish Market Pty Ltd, a company established to manage and develop the operation of the wholesale fish market activities. The company has a landlord role at the market. The trading of fish is carried out by the tenants.

City of Melbourne Annual Report 2009–10

The City of Melbourne has an interest in other entities including:

• the Sustainable Melbourne Fund (the City of Melbourne holds all units in this trust), a strategic trust established to support and promote sustainable development • the Regent Management Company Limited. Shared with the State Government, the City of Melbourne has a 50 per cent interest in this company, established to manage the historic Regent Theatre in Collins Street, Melbourne • MAPS Group Limited trading as Procurement Australia. The City of Melbourne is majority shareholder of this company.

Member, Council of Capital City Lord Mayors

The Lord Mayor of Melbourne is a member of the Council of Capital City Lord Mayors, which comprises the lord mayors of all capital cities and the ACT’s Minister for Territory and Municipal Services. It coordinates and represents the special interests of Australia’s state and territory capital cities and their relations with other spheres of government.

Partner, Inner Melbourne Action Plan (IMAP)

The Inner Melbourne Action Plan (IMAP) is an initiative of the local governments of Melbourne, Yarra, Port Phillip and Stonnington to make the inner Melbourne region more liveable. IMAP coordinates the implementation of 11 regional strategies, which focus on priority areas including affordable housing, environmental improvements, tourism and sustainable transport.

Participation in council

The City of Melbourne welcomes attendance and participation at council and committee meetings. Members of the public can make submissions to the council or a committee on matters listed on meeting agendas. A register of public submissions made under Section 223 of the Local Government Act 1989 (Vic) is available for viewing at the City of Melbourne’s offices.

Records of meetings, details of how to participate in a council or committee meeting and meeting dates and times are available on the City of Melbourne website www.melbourne.vic.gov.au

City of Melbourne Annual Report 2009–10

CORPORATE GOVERNANCE

Corporate governance encompasses the processes, protocols, conduct and relationships that guide the Melbourne City Council’s actions and decision-making. Some mechanisms of governance are legislative requirements and others are the council’s initiatives.

Councillor conduct

The City of Melbourne’s Councillor Code of Conduct outlines the role of the council and provides an overview of the councillors’ responsibilities in accordance with the Local Government Act 1989 (Vic). The code includes guidelines for rules of conduct, decision-making and use of the City of Melbourne’s resources. It also includes procedures for disclosure of interests and conflicts of interest that go beyond legislative requirements. There were no known breaches of the code by councillors in 2009–10.

Council meetings

The council generally meets monthly, with a schedule of meeting dates available on notice boards at the Melbourne Town Hall, North Melbourne Library, East Melbourne Library, City Library, Carlton Baths Community Centre, the Hub at Docklands and the City of Melbourne website.

All meetings of the council and its committees are conducted in accordance with the Conduct of Meetings Local Law 2001. While meetings are open to the public and the public is encouraged to attend, the council may close any meeting to the public to discuss any of the following:

• personnel matters • the personal hardship of any resident or ratepayer • industrial matters • contractual matters • proposed developments • legal advice • matters affecting the security of municipal property • any other matter which the council or special committee considers would prejudice the council or any person • a resolution to close the meeting to members of the public.

Council special committees

As well as council meetings, Melbourne City Council has three special committees:

• Future Melbourne Committee • Docklands Coordination Committee • Inner Melbourne Action Plan Implementation Committee.

City of Melbourne Annual Report 2009–10

During 2009–10 the council established the Future Melbourne Committee and dissolved the following committees:

• Planning Committee • Finance and Governance Committee • Connected City Committee • Eco-city Committee • Economic Development and Knowledge City Committee • People and Creative City Committee.

The Future Melbourne Committee (meets twice monthly)

This committee has delegated powers, duties and functions directly relating to, or ancillary to, all aspects of the City of Melbourne’s activities. The Future Melbourne Committee’s terms of reference are grouped into six themes or portfolios being:

• Planning:

• Connected City • Eco-city • Economic Development and Knowledge City • People and Creative City • Finance and Governance

All councillors participate in the Future Melbourne Committee.

Docklands Coordination Committee (meets quarterly)

This committee manages coordination between the City of Melbourne and VicUrban to ensure an open public discussion in this developing area. The committee, which includes senior representatives from both the City of Melbourne and VicUrban, meets quarterly to monitor place management services within the coordination area.

Inner Melbourne Action Plan Implementation Committee (meets quarterly)

This committee has delegated powers, duties and functions directly relating to, or ancillary to, overseeing implementation of the Inner Melbourne Action Plan in accordance with the agreed three year implementation program. The committee comprises representatives from the local governments of Melbourne, Port Phillip, Stonnington and Yarra.

City of Melbourne Annual Report 2009–10

Council and committee meeting attendance: 1 July 2009 to 30 June 2010

Number of meetings LM Robert Doyle DLM Susan Riley Cr Peter Clarke Cr Carl Jetter Cr Jennifer Kanis Cr Kevin Louey Cr Cathy Oke Cr Ken Ong Cr Brian Shanahan Melbourne City Council meetings 13 10 13 13 11 12 12 12 12 11 Committee meetings Finance and Governance (dissolved February 2010) 7 5 6 5 7 6 6 6 6 7 Planning (dissolved February 2010) 6 4 5 5 5 6 6 6 6 6 People and Creative City (dissolved December 2009) 5 4 4 3 5 5 4 4 4 4 Economic Development and Knowledge City (dissolved December 2009) 3 2 3 1 3 2 3 2 3 3 Connected City (dissolved December 2009) 2 1 2 1 1 2 2 2 2 2 Eco-city (dissolved December 2009) 3 1 2 3 3 3 3 3 3 3 Future Melbourne (established December 2009) 12 11 12 12 9 12 12 12 12 11 Inner Melbourne Action Plan 4 .. .. 3 ...... Docklands Coordination 4 ...... 3 * ...... Not a member

* Alternate member

In many cases, absence from committee and council meetings is a result of Councillors being required to represent the city on other council business.

City of Melbourne Annual Report 2009–10

Councillor allowances

Councillors are paid an allowance set by the Victorian Government. This allowance is paid in recognition of the demands placed on councillors in carrying out their civic and statutory duties, and for their work on policy development, as spokespeople on community matters and as representatives of the Melbourne City Council and Melbourne, both in Australia and overseas.

The allowances are:

• Lord Mayor: $151,598 • Deputy Lord Mayor: $62,013 • Councillors: $34,440.

Expenses

Councillors incur expenses in the course of fulfilling their roles. Expenditure is regulated by the Councillor Expenses and Resources Guidelines, as endorsed by the Finance and Governance Committee and consistent with Section 75 of the Local Government Act 1989 (Vic). Councillor expenses are reported in detail every quarter on the City of Melbourne website.

Legislative compliance

Freedom of information The Freedom of Information Act 1982 (Vic) gives any individual or organisation the right to access information held by the City of Melbourne unless that information is deemed exempt under the Act.

In 2009–10 the City of Melbourne received 42 valid applications seeking documents about building and planning matters, parking infringements and the costs and activities of councillors and officers. The number of requests received was less than the previous financial year’s total of 50.

There was one request for an internal review in 2009–10. The outcome of the review was that the original decision was varied. No applicant appealed to the Victorian Civil and Administrative Tribunal and no complaints were received by the Ombudsman.

The Act specifies a 45-day statutory time limit to process requests. The average processing time for requests received by the City of Melbourne in 2009–10 was 34 days. National Competition Policy compliance The City of Melbourne complied with the requirements of the National Competition Policy Principles in 2009–10, which covers compliance in trade practices, local laws and competitive neutrality. Privacy Act Standards set out by the Information Privacy Act 2000 (Vic) and the City of Melbourne’s Privacy Policy Statement control how we manage personal information. Privacy compliance is included in our staff induction program. We have a dedicated privacy officer within our Governance Services Branch to assist staff and members of the public with privacy-related queries or issues.

The City of Melbourne received two privacy complaints from members of the public during 2009–10. Both complaints were resolved.

City of Melbourne Annual Report 2009–10

Whistleblowers Protection Act 2001 (Vic) Complaints about the improper conduct of any City of Melbourne officer can be made confidentially, under the Whistleblowers Protection Act 2001 (Vic), to the Victorian Ombudsman or to any one of the following officers appointed to receive disclosures:

• Dr Kathy Alexander, Chief Executive Officer • Linda Weatherson, Director, Community Development • Jane Sharwood, Manager, Business and International.

In 2009–10, there were no disclosed matters referred to the City of Melbourne by the Ombudsman, or from the City of Melbourne to the Ombudsman.

Risk management

The City of Melbourne manages its risks to maximise opportunities and minimise losses. Risk management planning is done as an organisation-wide exercise, covering the top strategic risks plus operational and project risks. It is also part of the daily business activities of individual branches and contractors. Risk management strategy, fraud awareness and training The activities associated with the City of Melbourne’s Risk Management Strategy 2007–2010 were completed, and a new risk management strategy for 2010–13 was adopted. In 2009–10, risk exposures were updated and revised for all of the City of Melbourne’s branches and recorded in the risk module of the organisation’s integrated corporate business planning software. The Chief Executive Officer and directors undertook an annual major review of the top strategic risks, and these were reported to the Audit Committee, along with the wider organisational risks.

One major risk project undertaken during the year was the development and launch of a new risk and audit module. The modules were integrated with the organisation’s business planning software and were launched in December 2009, replacing two existing databases and eliminating the need for a third database for occupational health and safety matters. The modules brought together planning, risk management and audit functions in a single application. This has improved the efficiency and effectiveness of risk reviews and management reporting.

As part of their induction after joining the City of Melbourne, new staff attended sessions to increase awareness of the signs and ways to address improper conduct and fraud. A range of other courses were conducted in 2009–10, such as an introduction to risk management, event risk management and trade practices in local government. Insurance and risk financing One new claim for the major insurance class of property was submitted to the City of Melbourne’s insurers during 2009–10 following a major storm in March.

The cost of insurances to the City of Melbourne increased only marginally within expectations during 2009–10. This, in part, reflects the organisation’s proactive approach managing risks and controlling any losses that arise. Business continuity planning, crisis management and influenza pandemic In 2009–10 the City of Melbourne finalised the Corporate Business Continuity Plan and updated its business continuity recovery plan, the Information Technology Disaster Recovery Plan, and conducted business impact analysis for each branch. This was in preparation for a large scale exercise to test the various plans, based around a simulated H1N1 influenza (swine flu) outbreak. This incorporated training and liaison with Victorian Government authorities, and other organisations including the City of Melbourne’s major contractors. A detailed plan was then established to guide

City of Melbourne Annual Report 2009–10

next year’s test exercises. A major revision of the City of Melbourne’s Crisis Management Manual was also begun to ensure it is consistent with other plans.

Audit committee

In line with good governance practices and in accordance with Section 139 of the Local Government Act 1989 (Vic), the City of Melbourne has operated an Audit Committee since 1996. The committee, formally appointed by the Melbourne City Council, oversees the activities of the City of Melbourne’s external and internal auditors and gives independent advice to the Future Melbourne Committee on appropriate accounting, auditing, internal control, business risk management, compliance and reporting systems, processes and practices within the organisation.

The Audit Committee met five times during 2009–10. The committee considered and made recommendations to the council and City of Melbourne management on many issues including:

• internet security • occupational health and safety • the City of Melbourne’s business continuity planning procedures • the City of Melbourne’s risk profile and legislative compliance frameworks • statement of annual accounts and performance report for council, and reports on its wholly owned subsidiaries • governance responsibilities applicable to associated entities and trusts in which the City of Melbourne has either an indirect interest or stake • legal action reports • procurement process compliance • planning and building legislative compliance • City of Melbourne’s assurance processes.

Audit Committee members – Independent

Richard Moore – Chair Richard was appointed to the Audit Committee in July 2009.

Qualifications:

• partner of PriceWaterhouseCoopers for 23 years • five years Group Manager, Audit for the ANZ Banking Group • extensive consulting and management experience in risk management and internal control.

Theresa Glab Theresa was appointed to the Audit Committee in September 2008.

Qualifications:

• Masters in Accountancy • Certified Practicing Accountant • Partner at Moore Stephens, Melbourne.

City of Melbourne Annual Report 2009–10

John Stewart John was appointed to the Audit Committee in May 2010.

Qualifications:

• Director of BDO Kendalls 1986–2008 (BDO Kendalls provides expertise in a broad range of services, including audit, accounting, taxation, risk management, forensic and corporate advisory services) • Board member of the Executive of BDO Kendalls for six years • Chairman of the Audit Committee of Harness Racing Victoria • Chairman of the Finance and Audit/Risk Committee of Ritchies Stores Pty Ltd.

Claire Filson Claire Filson resigned from the Audit Committee in January 2010, having been a member since 2004, and was due to complete her second three-year period that commenced in August 2007.

Qualifications:

• Bachelor of Law; Masters of Business Administration • experienced director and company secretary of both private and public organisations • Director of the Southern Cross Station Authority where she chairs the Audit Committee • Director of Emergency Services and State Superannuation Board and Audit Committee member.

Internal audit

The internal audit service helps the City of Melbourne, its management, and the management of its subsidiary companies, perform their responsibilities. The internal audit service helps us maintain an organisational environment with strong, relevant and effective internal controls.

The City of Melbourne’s internal auditor reports to the Audit Committee. The service is contracted to Deloitte Touche Tohmatsu, which started its first three-year term in July 2009.

A strong internal control environment ensures our systems contribute effectively to management of operations. Services provided by the internal audit service include:

• risk assessment • development and management of an audit program • conducting audits and reviews • reporting audit opinions, findings and recommendations • presenting, discussing and providing advice on key issues.

External audit

The Victorian Auditor-General is responsible for the external audit of the City of Melbourne and its subsidiary companies. Our external audit focuses on three key areas:

• strategic planning • detailed audit system testing • review of financial statements.

City of Melbourne Annual Report 2009–10

Documents available for inspection

The Local Government Act 1989 (Vic) requires the City of Melbourne to keep certain statutory registers and documents, which can be viewed on request, or in certain cases, on application. Available documents include:

• Council and committee meeting agendas and minutes • list of special committees established or abolished • agreements to establish regional libraries • list of contracts valued at $150,000 or more which the council entered into outside the competitive process, except Section 186(5) contracts • names of councillors and City of Melbourne officers required to submit a return of interest and the date returns were submitted • details of interstate and overseas travel by councillors and City of Melbourne officers • details of senior officers’ total salary packages • details of all property, finance and operating leases involving land, buildings, plant, computer equipment or vehicles entered into by the City of Melbourne (as lessor or lessee) • list of donations and grants made by the City of Melbourne • list of organisations of which the City of Melbourne is a member, and details of membership fees • mayoral and councillor allowances • register of authorised officers • register of delegations • Whistleblowers Protection Act 2001 (Vic) procedures • submissions received under Section 223 of the Local Government Act 1989 (Vic) • election campaign donation returns • records of assemblies of councillors.

City of Melbourne Annual Report 2009–10

CITY OF MELBOURNE, THE ORGANISATION

Melbourne City Council (commonly known as the City of Melbourne) is a public statutory body corporate under the Local Government Act 1989 (Vic). The Act sets out the primary purposes and objectives of the council, and defines its functions and powers.

The City of Melbourne’s headquarters is the Melbourne Town Hall in Swanston Street. The organisation also operates facilities, services and administration functions from more than 30 other locations including childcare centres, parks and gardens and swimming pools.

The City of Melbourne’s organisational structure consists of five divisions and 27 branches.

Organisation structure

City of Melbourne Annual Report 2009–10

Chief Executive Officer

Dr Kathy Alexander is the City of Melbourne’s Chief Executive Officer (CEO). Her functions and powers are principally determined by the Local Government Act 1989 (Vic) and include:

• establishing and maintaining organisational structures to implement the Melbourne City Council’s decisions • ensuring the council’s decisions are implemented • managing the organisation’s day-to-day operations • providing advice to the council • appointing, directing and terminating staff, and managing all other issues that relate to staff.

The office of the CEO liaises with the offices of the Lord Mayor, Deputy Lord Mayor and councillors, the Australian and Victorian governments and other major community and corporate stakeholders. The CEO also attends council meetings.

Directors

The City of Melbourne has five divisions, each led by a director. The CEO and directors manage the City of Melbourne’s operations and ensure the council receives the strategic information and advice it needs to plan for the municipality and make decisions. The divisions and their directors are: City Design, Rob Adams AM The City Design Division is responsible for developing strategic plans and urban design policy as well as delivering best practice in design, project management and parks services. This division delivers a range of projects and services for residents, workers and visitors to the municipality. The division has primary responsibility for Docklands and the coordination and delivery of major projects and the capital works program. It also ensures the City of Melbourne maintains its reputation as a leader in the sustainable design and management of public spaces. City Business, Martin Cutter The City Business Division focuses on supporting existing business and business development in Melbourne. The division contributes to positioning Melbourne as a world-class city in local, national and international markets through managing events, tourism services, international business relationships and marketing programs. The division works with a wide range of stakeholders including ratepayers, businesses, retailers, city visitors, tourists, sister cities, major sporting bodies and government departments. City Planning and Infrastructure, Geoff Lawler The City Planning and Infrastructure Division advises the council on research, city planning and the future sustainable development of Melbourne. It manages the City of Melbourne’s built and constructed assets such as roads infrastructure and public buildings as well as municipal services such as parking and traffic management, and residential waste and street cleaning. This division also maintains municipal property information and administers local laws and regulations to develop, improve and protect the general amenity of the municipality. The director is responsible for the City of Melbourne’s interests in the Sustainable Melbourne Fund and the Office of Knowledge Capital and is a member of the Inner Melbourne Action Plan Implementation Committee.

City of Melbourne Annual Report 2009–10

Community Development, Linda Weatherson The Community Development Division plans and provides high quality, cost-effective and customer-focused human services to the community. The division assists the organisation with community engagement and provides the community with recreation services, health services, family and childrens services, aged care services, the library service and the customer relations service. This, coupled with the delivery of cultural programs, management of the municipality’s cultural infrastructure and implementation of Melbourne’s policy for the 24 city, enhances the City of Melbourne’s reputation as a safe, attractive, liveable and accessible city. Corporate Business, Mark Stoermer The Corporate Business Division is primarily responsible for providing support services to the organisation. These services include legal advice, human resource management, information technology systems, corporate planning, financial reporting, property services and management of the municipality's financial assets. The division also plays a role in liaising with our wholly-owned subsidiaries which contribute more than four per cent of the City of Melbourne’s revenue.

City of Melbourne Annual Report 2009–10

Organisational profile

Employment profile

Employment figures in this annual report are for City of Melbourne employees only and do not include employees of our subsidiary companies. Staff profile The majority of staff work in the central city, however some staff members are located at other sites across the municipality. As at 30 June 2010, the City of Melbourne employed 1253 people. We have:

• 955 full-time staff • 298 part-time staff

Of these, 149 are non-permanent staff, including:

• 107 maximum-term temporary • 42 casual

The gender balance of staff at the City of Melbourne is split approximately 55 per cent female and 45 per cent male. Women hold 22 per cent of executive positions. Seventy five per cent of female staff and 67 per cent of male staff are employed in medium-paying positions ranging from classifications 3 to 6.

Figure 1. Employee classification by gender

160 Female Male 140

120

100

0 Cl 1 Cl 2 Cl 3 Cl 4 Cl 5 Cl 6 Cl 7/Exec A Exec

Staff classifications Class 1 and 2: child care workers, school crossing supervisors, fitness instructors, information officers

Class 3: child care workers, parking and traffic, office administrative support

Class 4: administrative support, immunisation nurses, environmental health, project officers

Class 5 and 6: professionals, analysts, programmers, technical staff, maternal and child health nurses, event managers

City of Melbourne Annual Report 2009–10

Class 7: team leaders and professionals

Executive: managers, directors and CEO.

Figure 2. Number of staff by age group

250

Female Male

200

150

100

0 18 to 24 yrs 25 to 34 yrs 35 to 44 yrs 45 to 54 yrs 55 to 64 yrs 65+ yrs

Figure 3. Number of staff by years of service

250

Female Male

200

150

100

0 < 1 yr 1 yr to < 2 2 yrs to < 5 5 yrs to < 10 10 yrs to < 15 yrs to < 20 yrs to < 25 yrs to < 30 yrs to < 35 yrs to < > 40 yrs yrs yrs yrs 15 yrs 20 yrs 25 yrs 30 yrs 35 yrs 40 yrs

City of Melbourne Annual Report 2009–10

Work-life balance programs At City of Melbourne we recognise that work is just one part of our employees’ lives. The City of Melbourne has a number of support mechanisms to help staff manage a work-life balance. These programs include the Leap into Life program and an Executive Health program, through which we provide staff with information via educational sessions and online interactive tools.

Our employee recreation association, CoMLife, provides a range of health and wellbeing programs and social opportunities for staff. Membership of CoMLife has continued to grow in 2009–10. During the year the association provided discounted wellbeing classes, supported corporate sports teams, encouraged participation in charity events such as Movember and Cancer Council fundraising, and sourced discounts for staff on gym memberships, massages, sportswear and other health products. The CoMLife program also offers subsidised Melbourne social events, sporting events and entertainment tickets. Staff retention Improving staff retention rates is of high priority to the City of Melbourne. Although voluntary staff turnover has increased slightly this year, the increase is on par with industry trends following the global financial crisis of 2009. The staff turnover rate is still lower than it was between 2006–08 when it reached 12.7 per cent.

Figure 3. Staff turnover

Average Positions applicants Staff turnover Absenteeism advertised per position (see note 1) (see note 2)

2009–10 232 26 9.6% 2.8%

2008–09 222 28 7.9% 2.7%

2007–08 381 23 12.7% 3%

2006–07 164 34 12.7% 3.1%

2005–06 223 37 15% 3%

Note 1: Voluntary (resignations) turnover only Note 2: Total sick leave absences as a percentage of ordinary time available

Occupational health, safety and wellbeing

The City of Melbourne manages risk and occupational hazards by continuously improving its work environment and occupational health and safety management system. Accreditation against SafetyMAP Fourth Edition – Advanced Level and Australian Standard AS/NZS 4801:2001 OHS Management Systems criteria has been maintained. The continuous improvement of our safety systems and processes across the organisation ensures our people are safe at work and also that safety is embedded in our workplace culture.

Staff development and support services

At the City of Melbourne, our staff are our most important asset and in addition to providing services to our community, the wellbeing of our staff is our highest priority. We are committed to developing our people through a range of leadership development programs, study assistance and corporate learning programs. In 2010, we had two teams represent the organisation in the Local Government 37

City of Melbourne Annual Report 2009–10

Managers Australia Challenge, an internationally acclaimed professional/team development program which aims to build future leaders within local government. One of our teams finished in first place, going on to represent Victoria in the Australasian finals.

A range of support services from career counselling to rehabilitation services are available for all staff. In 2009–10 the City of Melbourne supported staff to return to work following personal or work related illness or injury by providing:

• in-house allied health professional services • access to specialists in occupational and environmental medicine • early intervention strategies such as ergonomic reviews • the development of return-to-work plans.

WorkCover claims

The City of Melbourne received 20 WorkCover claims in 2009–10. Our WorkCover premium continues to fall and is now at 0.64 per cent. This is significantly lower than the local government sector rate of 1.48 per cent.

The City of Melbourne has a proactive injury prevention strategy and adopts an early intervention approach to all work related injuries and illnesses by focussing on sustainable return-to-work programs.

Figure 4. WorkCover claims

Standard Minor Premium inc. Premium as % of Year claims claims GST ($) remuneration

2009–10 16 4 599,653 0.64%

2008–09 3 5 754,000 0.65%

2007–08 8 17 767,000 0.88%

2006–07 7 19 940,000 1.15%

2005–06 12 13 1,141,000 1.51% Source: Victorian WorkCover Authority

Equal Employment Opportunity Policy

The purpose of our Equal Employment Opportunity Policy is to prevent discrimination and harassment in the workplace. The City of Melbourne is an equal opportunity employer and is committed to the provision of a work environment that is safe and supportive, where individuals treat each other with respect. Our network of equal employment opportunity contact officers are trained to assist employees to identify options and resources to deal with workplace issues.

In 2008 we introduced an Indigenous traineeship program. Since its inception, six trainees have participated, with three trainees continuing during 2009–10. In addition, an integral part of the induction process for all new employees is a walk highlighting Melbourne’s Indigenous heritage.

City of Melbourne Annual Report 2009–10

Our equal employment opportunity commitment sits within our Workplace Diversity Framework and addresses requirements under Schedule 6 of the Local Government Act.

Workplace diversity

Workplace diversity involves recognising the value of individual differences. Our Workplace Diversity Framework includes principles, objectives and strategies to increase the diversity of City of Melbourne staff. The framework builds on our existing values: integrity, courage, accountability, respect and excellence.

In April 2010 we undertook our first diversity census, inviting participation from all staff across the organisation. Our organisational strengths were that staff felt welcome and respected at work, and felt they were treated fairly. Staff also felt they had access to professional development and training opportunities, and felt safe from bullying and harassment.

This year, 2010, is the Year of Women in Local Government. The need to recognise, value and promote women in senior management and leadership roles within local government is as great as ever. As such, the City of Melbourne is initiating My Mentor, a women’s development program.

In 2010 we won our second Fair and Flexible Employer Award from the Victorian Government, for developing innovative programs and practices to improve the work and family balance of our employees.

Enterprise bargaining agreement

The City of Melbourne has a collective bargaining agreement that covers approximately 90 per cent of employees. This bargaining agreement includes sustainability targets, work conditions and employee benefits. To maintain its position as a fair and flexible employer, the City of Melbourne monitors the operation and application of the agreement through a joint staff consultative committee that meets on a quarterly basis.

City of Melbourne Annual Report 2009–10

Awards

Victorian Branch of Environmental Health Australia award for Excellence in the category of Leadership and Strategic Planning. Awarded for the integration of the Municipal Health Plan with Council Plan

2009 Human Resources Leadership Award. Highly commended in the category of Best Health and Wellbeing Strategy

Winner of the 2010 Victorian Government Fair and Flexible Employer Award

Winner of the 2009 Victorian Red Cross ‘Club Red’ blood donation corporate challenge

Strategic Purchasing Award. Winner in the category of Collaboration for the E-tendering and Information Hub project

Australian Award for Urban Design for the Transforming Australian Cities Study

2009 Local Government Excellence in ICT Award. Outstanding achievement in managing IT disaster recovery

Victorian Stormwater Industry Association Award. Merit for Regional Action in Water Sensitive Urban Design

2009 Heart Foundation Local Government Award. Victorian winner and highly commended nationally in the category of Employee Health and Wellbeing

2009 Planning Institute of Australia Award. President’s Award for the Residential Intensification in Tramway Corridors project

Australian National Parking Steering Group 2009 Local Government Award for Excellence in Customer Service

Australian Safer Communities Award. High commendation for the CBD Safety Plan

2009 International Education Association of Australia Award. Winner in the category of Best Practice/Innovation in International Education for the 2009 Welcome to International Students

Green Building Council of Australia Award. 6 Green Star rating for the City of Melbourne Council House 2 building

City of Melbourne Annual Report 2009–10

Events

The City of Melbourne presents and supports a range of events which contribute to the vitality of the city and to Melbourne’s reputation as a world-class destination. Arts and culture, sports and family entertainment feature in this busy calendar.

(O) = City of Melbourne owned (SFS) = City of Melbourne sponsored, funded or otherwise supported

July 2009 The 2009 City of Melbourne Women In Circus Oz at Birrarung Marr (SFS) Business Lunch (SFS) Melbourne International Design Festival / State Melbourne Cycling Festival (SFS) of Design Festival (SFS) Leonardo Da Vinci ‘Anatomy To Robots’ (SFS) Melbourne Open House (SFS) Around The Bay In A Day (SFS) Welcome to International Students (O) Festival Indonesia 2009 (SFS) Melbourne International Film Festival (SFS) Community Safety Day (SFS) August 2009 Pink Breakfast (SFS) National Science Week at Queen Victorian Give It A Go (SFS) Market (SFS) Megaramp Throw Down Tour (SFS) Burke and Wills Expedition 150th Anniversary November 2009 Commemorations (SFS) Emirates Melbourne Cup Parade (SFS) Melbourne Awards 2009 (O) Melbourne Cup Carnival live sites and Melbourne Day 2009 (O) activities (SFS) Melbourne Spring Fashion Week (O) Emirates Melbourne Cup Day 2009 (SFS) September 2009 Crown Oaks Day (SFS) Toyota AFL Finals Series (SFS) Christmas – Santa's Grand Arrival (O) International Public Works Conference (SFS) Emirates Stakes Day (SFS) Spring Into Shape (SFS) Christmas – Tree Lighting Spectacular (O) Royal Melbourne Show (SFS) Myer Store Windows Launch (SFS) Cubamemucho – International Cuban Dance Polish Festival (SFS) Express (SFS) Australasian World Music Expo (SFS) The Age Melbourne Fringe Festival (SFS) Thessaloniki Festival (SFS) Toyota AFL Grand Final Parade (SFS) Eureka Tower Charity Stair Climb (SFS) Toyota AFL Grand Final Week and live site The Olympic Dream (SFS) (SFS) Super Human: Revolution of the Species Toyota AFL Grand Final 2009 (SFS) Symposium (SFS) Earthdance Melbourne 2009 (SFS) Rat Race Melbourne (SFS) The Magic of Dance (part of Seniors Week) Women's Circus (SFS) (SFS) Victoria Dragon Boat – Corporate Team (SFS) Victoria Dragon Boat – Corporate Team (SFS) The Melbourne Movember Gala Parte (SFS) October 2009 ABN Amro Hockey Championships Trophy – Refugee Camp In Your City (SFS) Men Melbourne 2009 (SFS) Spring Open Day 2009 (SFS) December 2009 Social Enterprise World Forum (SFS) Christmas – Advent Calendar (SFS) Melbourne International Arts Festival (SFS) LIME Connection III Conference (SFS) Diwali Festival 2009 (SFS) Relay for Life (SFS) St George Melbourne Marathon 2009 (SFS) 125th Anniversary Christmas Extravaganza Jayco Herald Sun Tour (SFS) (SFS) National Ride to Work Day (SFS) Victoria Dragon Boat – Docklands Cup (SFS) Australian DanceSport Championships (SFS)

City of Melbourne Annual Report 2009–10

Australia Post Opera In The Bowl (SFS) Melbourne International Flower and Garden 50th Annual L'Oréal Paris AFI Awards (SFS) Show (SFS) Fair@Square Fair Trade and Ethical Festival Alfa Romeo 100th Anniversary Celebration 2009 (SFS) (SFS) Chanukah in the City 2009 (SFS) Formula 1 Australian Grand Prix 2010 (SFS) Carols by Candlelight – live site (SFS) Antipodes Festival (SFS) 3 mobile Boxing Day Test Match (SFS) La Faya Festival 2010 (SFS) Melbourne Boxing Day Test – live site (SFS) Melbourne International Comedy Festival 2010 Boxing Day Music Festival (SFS) (SFS) New Year's Eve in the City (O) The Carlton Outback Kids Project 2010 (SFS) January 2010 April 2010 Summer Fun in the City (SFS) Melbourne Vixens – Championship Season Australian Open (SFS) 2010 (SFS) Audi Victoria Docklands Week (SFS) The Melbourne Latin Festival (SFS) Australia Day (SFS) Australian Men's and Mixed Netball February 2010 Championships (SFS) Melbourne International Boat and Lifestyle Live Earth Run For Water (SFS) Festival (SFS) Anzac Day (O) Chinese New Year Regatta – Yarra (SFS) Human Rights Arts and Film Festival (SFS) Go The Tan (SFS) May 2010 Russian Community Festival – Pancake Day Melbourne International Jazz Festival (SFS) 2010 (SFS) Dutch Orange Day (SFS) Chinese New Year (SFS) Mothers Day Classic (SFS) Melbourne Wooden Boat Festival (SFS) Law Week, Legal Laneway Breakfast (SFS) Sustainable Living Festival 2010 (SFS) Buddha's Day and Multicultural Festival (SFS) Australian Henley Regatta (SFS) Melbourne Italian Festival (SFS) Melbourne Summer Cycle 2010 (SFS) June 2010 Movie Extra Tropfest (SFS) Circus Oz at Birrarung Marr (SFS) The Great Australian Sunny Sizzle (SFS) The Light in Winter (SFS) We Can Walk It Out (SFS) Seasonal Stars (SFS) HYP Festival (SFS) Melbourne Winter Masterpieces – European March 2010 Masters: Stadel Museum (SFS) Melbourne Storm Family Day, clinic and Sunday Markets Entertainment (O) community services provisions for the 2010 season (SFS) Moomba Festival (O) The Push/City of Melbourne Laneway Show (SFS) Welcome to International Students (O) Moomba Parade (O) Melbourne Food and Wine Festival 2010 (SFS) Herald Sun/Citylink Run For The Kids (SFS) L'Oréal Melbourne Fashion Festival 2010 (SFS) Victoria Harbour School Sailing Series (SFS) Melbourne International Dragon Boat Festival (SFS) Melbourne City Romp (SFS) Thai Culture and Food Festival (SFS) 42

City of Melbourne Annual Report 2009–10

PART TWO – Our Performance

City of Melbourne Annual Report 2009–10

CITY OF MELBOURNE PERFORMANCE

Details of our performance in 2009–10 against Council Plan 2009–2013 are outlined in this section. Our performance is reported against eight goals and includes our annual achievements, measures and future plans. We have also highlighted a community engagement activity related to each of the eight goals.

We aspire to be:

1. a city for people

2. a creative city

3. economic prosperity

4. a knowledge city

5. an eco-city

6. a connected city

7. an organisation that leads by example

8. an organisation that manages our resources well.

Percentage of Annual Plan and Budget 2009–10 activities and initiatives achieved

The City of Melbourne Annual Plan and Budget 2009–10 set out an ambitious program of 109 activities and initiatives and 11 key strategic activities to be completed during the 2009– 10 financial year over and above standard service delivery to the community. Eighty five per cent of these actions were either complete or more than 80 per cent complete as at 30 June 2010. The Annual Plan and Budget 2009–10 is part of our integrated planning framework.

Our achievements against the Annual Plan and Budget 2009–10 can be found on the following pages.

City of Melbourne Annual Report 2009–10

GOAL ONE – A CITY FOR PEOPLE

The City of Melbourne has an important role in making the municipality great for people to live in and visit.

We recognise that we must address the needs of a growing population. We want people to experience our city’s array of activities and to meet, play and relax in streets and public spaces that are safe, clean, inviting and alive.

To this end our strategies include providing relevant and affordable services, advocacy and community infrastructure. We promote and encourage healthy people and communities and want to ensure that our community cultures are celebrated, embraced and connected to the broader community.

HIGHLIGHTS

Melbourne Planning Scheme review The City of Melbourne is required to review the Melbourne Planning Scheme every four years. This year a number of studies and reviews were completed, which have informed the review of the Melbourne Planning Scheme Municipal Strategic Statement. Projects completed this year include the draft Student Housing Policy, the Industrial Land Supply Study, a review of the draft Urban Design Strategy and a review of the Central City Built Form Provisions. A vibrant, clean city Following consultation with business and waste companies, the City of Melbourne adopted new commercial waste standards in December 2009. These new laws will ensure a more clean and welcoming city. All waste companies have now met their legal requirement to obtain a permit to collect waste and central city businesses are working to clean up their bins. Enforcement of the revised waste law began on 1 July 2010. International Day of Persons with Disabilities The International Day of Persons with Disabilities is held on 3 December each year. This year over 350 community members participated in a number of events across the municipality. Events included a live broadcast on disability issues at 3CR radio station, a dance event for deaf children, an inclusive theatre performance created by Carlton Neighbourhood Learning Centre and a youth live access event by Youth Disability Advocacy Services. Our City - Disability Action Plan 2010–13

This year Council developed the Disability Action Plan 2010–2013. The plan sets out specific outcomes for places, people and partnerships within the City of Melbourne that will:

• Reduce and eliminate barriers in our facilities, programs, services and information mediums • Lead the nation in provision of best practice in our universal access planning and service provision • Strengthen advocacy and partnerships with other tiers of government, government departments and community stakeholders to address and eliminate barriers in our country

City of Melbourne Annual Report 2009–10

• Reinforce a culture that celebrates the diversity of all people who live, work, study or visit our city. ‘Doin it again 4 Rec 2010’ music event Aimed at promoting Indigenous culture and reconciliation, a free music event was held at the Melbourne Town Hall in May 2010. Attended by more than 250 people and involving acts such as Indigenous hip hop artists and a cross-culture youth band, the event acknowledged the important role young people have in our community as future leaders and promoted the experiences of Aboriginal and Torres Strait Islander people. Caring for our children and youth This year, two plans were developed to cater for the present and future needs of our children and youth. Designed to complement one another, the Children’s Plan 2010–13 caters for children up to the age of 12, and a Young People’s Policy is a plan for young people aged 12 to 25 years.

Both plans were developed through consultation with parents, children, young people, community organisations and service providers. Children talked about their ideas, and illustrated their comments regarding what they liked and disliked about living in the municipality of Melbourne with photographs and drawings. Proposed activities within the plans include new projects for youth street teams and a new Young Emerging Leaders Award Program.

The quality of the City of Melbourne’s family and children’s services was endorsed this year with our five child care centres maintaining accreditation and our family support and counselling service achieving high standards in the quality assurance review conducted in February 2010.

This year the City of Melbourne launched the Your City Your Space online forum, designed by and for young people. This forum ran for six weeks and had over 2400 unique visits. Five priority issues and solutions were identified by young people and will be delivered by the City of Melbourne from 2010 to 2012. Aged care services During 2009–10, the City of Melbourne prepared the 2010–13 action plan for the Lifelong Melbourne strategy for positive ageing. The plan was developed in consultation with almost 40 older residents who participated in a seniors forum held in March 2010 to discuss the goals of Lifelong Melbourne and to plan for improved services over the next three years.

In July 2009, the City of Melbourne assumed direct responsibility for the financial and operational management of the Carlton Senior Citizens’ Centre. This has shifted responsibility from committee members who are now able to attend the centre to enjoy activities and friendship rather than spend time on ongoing administrative activities.

Renovation works took place at the Kensington Neighbourhood Centre to upgrade kitchen facilities to accommodate both the home delivered meals service as well as seniors groups' community lunches. New raised garden beds were also installed at this centre to transform unused outdoor space into a useable space for seniors. New city planning advisory committee In May 2010, the City of Melbourne formed a partnership with the Victorian Government to jointly assess town planning applications larger than 25,000 m2.

Prior to this agreement, the Victorian Government was responsible for all major planning decisions in Melbourne. As an equal partner within the new city planning advisory

City of Melbourne Annual Report 2009–10

committee, the City of Melbourne now has a much greater say on development proposals within the heart of the city. Responsible pet ownership As required under the Domestic Animals Act 1994, the 2008–11 Domestic Animal Management Plan was reviewed in November 2009. This review identified that no amendments to the plan were necessary. Animal management initiatives undertaken in 2009–10 included the implementation of a staff training program, a door knock program to encourage registrations, the purchase of dog bark count collars to assist with complaints and an increase in after-hours patrols of City of Melbourne parks and gardens. Homelessness street count 2010 In the early hours of the morning on one day in June 2010, the City of Melbourne conducted the third annual street count, to gather information on the number of people sleeping rough on the streets. To conduct the count, teams of volunteers visited parks and streets in the central city, North Melbourne and West Melbourne, as well as Flagstaff and Fitzroy Gardens to count the number of homeless people sleeping in public spaces and survey them where possible. This year, 101 people were counted and 55 people surveyed. It is important that we build up data on how many people sleep outdoors and where they are sleeping, so we can continue to help them through projects and services.

The City of Melbourne provides funding for organisations that support people experiencing homelessness for example Doutta Galla community health service to provide meals and Front Yard youth services that provide a centralised service support for young people.

This year the City of Melbourne facilitated a homelessness summit and a round table discussion with key service provider agencies to discuss issues and key service gaps. The outcomes of the forum will inform the development of the new City of Melbourne homelessness strategy. City safety Aimed at strengthening city safety, two security vehicles fitted with 360 degree CCTV surveillance cameras were deployed to patrol Melbourne streets during January and February 2010. The mobile security vehicles have been a welcome addition to the City of Melbourne’s 54 safe city cameras, with more than 1000 on-the-spot arrests being made in the last two years as a result of footage captured and provided to police. All recorded vision is strictly managed in accordance with council’s current safe city camera usage protocols, to ensure compliance with privacy provisions. To improve late night safety for city patrons, this year council installed two enhanced safe city taxi ranks at Queen Street and Flinders Street Station, St Kilda Road. Safer ranks mean that passengers can now wait for a taxi in a well- lit, secure area of the city. Grants and sponsorship program The City of Melbourne Grants and Sponsorship Program puts power back into the hands of the community to enliven the municipality with diverse arts and cultural activities. It encourages physical activity and improved life for our community.

In 2009–10, 27 people participated in our new community grant training program. Subjects offered included training in how to write grant applications, Certificate IV in Governance and a specialist monitoring and evaluation module. This new training program is an example of the innovative ways in which we provide continuing support to our Active Melbourne, community services and arts grant recipients.

City of Melbourne Annual Report 2009–10

Green Light Eat Right program Green Light Eat Right is a City of Melbourne program to help food outlets improve the nutritional value of their menus and enable consumers to make better food choices. The program was fully piloted this year at the Queen Victoria centre, located at the corner of Lonsdale Street and Swanston Street in Melbourne. Following the success of the pilot, the program has been adapted and applied at the North Melbourne pool, Carlton Baths and the Kensington Community Recreation Centre. The latest component of the program is the introduction of Green Light, Eat Right vending machines at Melbourne City Baths and the North Melbourne recreation centre. Active Melbourne The Active Melbourne program encourages all residents, city workers and visitors to be active regardless of age, gender, culture or ability. The municipality is home to a number of Victoria’s major sporting and recreation centres including the MCG, the Melbourne Tennis Centre and Flemington Racecourse. Managed by the City of Melbourne, the North Melbourne Recreation Centre and Melbourne City Baths were this year accredited as two of the 10 Lifesaving Victoria platinum pools. The municipality is also rich with local community facilities including the North Melbourne Community Centre, the Kensington Community Recreation Centre and the Carlton Senior Citizens. These centres are home to community activities such as soccer, community groups and children’s activities.

LOOKING AHEAD

Melbourne Planning Scheme review The Melbourne Planning Scheme review began in 2009–10 and included the completion of the draft Municipal Strategic Statement. Projects planned for 2010–11 include the development of planning scheme amendments related to urban density along transport corridors, central built form, the structure of Southbank, industrial land supply, heritage and climate change adaptation. City safety and security This year two additional enhanced safe city taxi ranks will be introduced within the central city and we will begin a late night waste collection service. There will be security surveillance in central city hotspots and more diverse late night activation will be developed. New framework to prioritise streetscape renewals A streetscape evaluation framework will be developed in 2010–11. This evaluation framework will be used to prioritise streetscape renewal projects across the municipality. All street assets will be considered, including footpaths, road surfaces, lighting, line- marking, landscaping and street furniture. as well as urban design, heritage and disability access requirements. Streets will be assessed to ensure they balance the needs of private vehicles, public transport, bicycles, motorbikes and pedestrians now and into the future. To support the new framework, a revised Asset Management Policy and Asset Management Strategy will also be finalised in 2010–11. Complete the Docklands Second Decade Plan In partnership with VicUrban, the City of Melbourne will develop a plan for the second decade of Docklands, by June 2011. The plan will guide development at Docklands over the next 10 years, incorporating a shared vision, activities and development initiatives.

City of Melbourne Annual Report 2009–10

Research to combat noise pollution In partnership with the University of Melbourne, the City of Melbourne will research innovative ways to combat noise pollution. We will explore the potential to develop a noise map of the city and the feasibility of a distributed wireless sensor network to manage noise pollution. New community infrastructure Child and maternal health centres, sports pavilions, town halls and libraries – they are all valuable community facilities that are available to everyone across the municipality. Guided by the City of Melbourne’s Community Infrastructure Implementation Framework, a number of community infrastructure works will begin in 2010–11. Projects include design of the new Docklands library and community centre, the design and start of construction on the new Boyd School community centre and library, an extension of the Falkner park child care centre as well as upgrade works at Kensington Town Hall. We will also begin design and documentation work to revitalise the Carlton Baths Community Centre and Carlton Family Resource Centre.

STRATEGIC INDICATORS TABLE

Strategic Indicators Result Comments Community satisfaction rating for City of % 78 The City of Melbourne rates Melbourne-owned recreational facilities the highest performing council within the Inner Melbourne Metropolitan Council group. This result is also higher than all other Victorian Councils. Community satisfaction rating for health % 68 Council will continue to focus and human services on this area in 2010–11 as the result continues to be lower than the Inner Melbourne Metropolitan Council group. Community satisfaction rating with the % 63 Performance remained overall performance of enforcement of unchanged from 2008–09 bylaws and the result is similar to the Inner Melbourne Metropolitan Council group and all councils. Community satisfaction for the City of % 54 This result has improved Melbourne on leading debate and taking from 2008–09 figures. action on crime and violence and antisocial behaviour in the municipality Community satisfaction rating for overall % 70 Performance remained performance of waste management unchanged from 2008–09, although this score was lower than the Inner Melbourne Metropolitan Council group, but similar to all councils.

City of Melbourne Annual Report 2009–10

Community satisfaction rating for overall % 70 Performance has rebounded performance of appearance of public areas from declining performance seen in 2008–09, to be similar to the Inner Melbourne Metropolitan Council group but higher than the score for all councils. Participation rates at key events, festivals # 670,000 Participation rates have and programs conducted by the City of continued to increase as the Melbourne city population and visitor numbers increase Number of sporting groups using City of # 80 Result is a combination of the Melbourne parks winter and summer season statistics

Percentage of visitors who feel safe in the % N/A Perceptions of safety central city research undertaken every three years. The last survey was undertaken in 2008–09. Overall satisfaction rating of visitors to the % N/A This survey is conducted City of Melbourne Parks biannually Percentage of the community who believe % N/A This survey is conducted it’s a good thing for society to be made up biannually of people from different cultures Number of people experiencing chronic # 101 This year the Salvation Army homelessness as measured by street count partnered with the project to results access squats and tent cities for the annual Street Count.

City of Melbourne Annual Report 2009–10

GOAL TWO – A CREATIVE CITY

The Future Melbourne Community Plan identified creativity as one of our city’s major strengths. To advance this reputation, we continue to support and promote a diverse range of artists and take art into the public realm so that everyone can participate. We also want to achieve growth in creative enterprises. Creativity is more than art and our aim is to get creative thinkers involved in decision making.

HIGHLIGHTS

Melbourne Conversations Consistent with the City of Melbourne’s objective of creating an inclusive environment that encourages participation, the Melbourne Conversations series has once again increased in popularity this year. Staged at the BMW Edge theatre at Federation Square, the Melbourne Conversations series informs, engages and entertains audiences through discussion around popular themes relevant to Melbourne and the city community.

Since its inception in 2001, Nobel Laureates, major literary and arts figures and famous figureheads such as the 45th Vice President of the United States, Al Gore have taken part in Melbourne Conversations. In 2009–10, 19 Melbourne Conversations events were held, attracting an audience of over 9000. Themes this year included future visions for the city, sustainable living, ageing and social inclusion. City of Melbourne Arts Strategy revised The draft City of Melbourne Arts Strategy was finalised this year for community comment. The revised arts strategy aims to encourage a vibrant, creative community and sets out a vision for nurturing and enhancing Melbourne’s arts community. A comprehensive community consultation is occurring in line with the City of Melbourne’s new community engagement framework. Engagement methods include staff and community workshops, outreach workshops with young people and children and an extensive online feedback process. The final strategy will be considered by councillors in August 2010. Launch of the new Signal arts facility Launched in February 2010, Signal is Melbourne’s first arts studio dedicated to people aged 13 to 20. Signal provides opportunities for Melbourne’s youth to work with professional artists across all art forms and is a place for making, showing, inspiring and developing our city’s new creative talents – in every medium. The new Signal facility houses a workshop space, a multi-purpose space, a computer and multimedia hub, a plaza for live events and an 18-speaker sound wall for sound- based artworks. Over 5000 young people have engaged in the Signal program in its first six months working with a wide range of artists and community and arts organisations. Supporting emerging artists through the Young Artists Grant Program Council continued to invest in the future of our emerging younger artists through the provision of seeding grants of up to $5,000 to assist in the creation of work and to activate the city. City of Melbourne is the only local government authority in Australia to provide a dedicated funding program to young artists. This program supports emerging artists up to 26 years age who have not previously received arts funding. In 2009–2010, Council received 13 applications resulting in 48 young artists being supported for the first time. Many of these projects and artists participated in major festivals including Next Wave, Fringe and Comedy. All art forms were supported and the projects reflected strong and confident ideas.

City of Melbourne Annual Report 2009–10

Artists activated innovative venues to present their work including the City Baths, City Library, a Youth Mental Health Centre along with major city galleries and performance spaces. ArtPlay ArtPlay further developed its highly popular annual program to enable a wide demographic of children and families to participate in high quality activities. Over 30,000 adults and children attended ArtPlay’s 336 workshops and performances and 78 days of free exhibitions and schools workshops. Arts House In 2009 Arts House introduced Green Tix for Nix, a program that enabled audiences to gain free entry to performances if they travelled to Arts House by using a planet friendly mode of transport. 1245 patrons participated in this initiative, travelling a total of 17,019 kilometres either on foot, on bike or on public transport and they saved a total of 3.83 tonnes in greenhouse gas emissions. Audiences at Arts House also increased. The number of attendances at Arts House North Melbourne Town Hall and Arts House Meat Market increased by 39 per cent from last year to 218,626 in 2009–10.

Partnership funding awarded to the City of Melbourne for Arts House Special Projects such as the Black Arm Band has increased by 98 per cent for 2009–10. A total of $1.9 million in external funding was secured, primarily due to partnerships with the Fred Hollows Foundation, Playing Australia, Major Festivals Initiative, Melbourne International Arts Festival, Vic Health, British Council, Arts Victoria and the Australia Council for the Arts. Art and heritage collection maintenance The City of Melbourne manages an arts and heritage collection comprising 7000 objects and artworks. The outdoor element of the collection includes 150 sculptures, memorials, monuments, fountains and drinking fountains located in Melbourne's public realm. Each year, conservation work is undertaken on many of our outdoor sculptures. Conservation work this year was undertaken on the South African war memorial at Kings Domain, the Sir William John Clarke statue in Treasury Gardens, the River God fountain in the Fitzroy Gardens, Coles fountain at Parliament Reserve and the Fairies Tree in the Fitzroy Gardens. Additionally, the Art and Heritage Collection’s City Gallery at Melbourne Town Hall produced four exhibitions in 2009–10 attended by over 20,000 people. Indigenous arts The Indigenous Arts Program continued to deliver a program encouraging Indigenous participation and contribution to the cultural diversity of Melbourne. In 2009–10 Indigenous choreographer, Jacob Boehme, was awarded the annual Indigenous Arts Mentorship and is currently being mentored by Melbourne’s leading contemporary dance company Chunky Move under the guidance of Artistic Director Gideon Obarzanek. The Blak Nite Cinema, an Indigenous film event held over two nights in the Treasury Gardens, also continues to develop a wide audience, attracting over 4000 people. Late night activation In 2009–10, Council initiated a ground breaking pilot program aimed at influencing late night culture in Melbourne's CBD by broadening the city's artistic offerings. Late night programming was designed to support the activation of the Melbourne CBD late at night and to add vibrancy and entertainment that was alternate to events in the CBD primarily centred on drinking. This pilot provided safe, diverse and vibrant cultural programs that were attractive to visitors and residents. The City of Melbourne committed over $100,000 to five of Melbourne's key festivals to support this initiative. These included the Melbourne International Comedy Festival who produced the Headliners and a Silent Disco; the

City of Melbourne Annual Report 2009–10

Melbourne International Jazz Festival who produced The Cave; the Next Wave Festival who produced The Ultimate Time Lapse Megamix; and the Melbourne International Film Festival and Melbourne Fringe who will be producing a program in late 2010. To date, the late night programming has produced 231 events/performances that have run from 11.00pm through to 8.00am. 9,656 people have attended late night events and 176 artists have been engaged in the programming.

LOOKING AHEAD

New creative hub in West Melbourne Creative Spaces is a City of Melbourne program established to assist artists and arts organisations to move to, or stay within the municipality. The Creative Spaces program manages 25 studios at Boyd School, providing advice to artists, arts organisations and building owners and manages the state wide Creative Spaces website. A three level warehouse on the City of Melbourne’s municipal boundary with the City of Maribyrnong has been identified as an additional affordable creative facility for our municipality. The warehouse, located at building 3, 41–59 Sims Street West Melbourne, is approximately 3000 m2 and will provide work space for up to 75 artists, including those artists traditionally difficult to accommodate, such as sculptors and musicians.

Strategic indicators Actual Comments The number of new artist/arts organisations # 78 2009–10 is a baseline year located within the municipality linked to City of for this indicator Melbourne’s Housing of the Arts Strategy The number of national and international arts # 65 2009–10 is a baseline year and cultural outcomes linked to the City of for this indicator Melbourne programs and partnerships The total number of cultural events held in the # 25 Out of 185 events for this City of Melbourne financial year 25 are cultural events.

City of Melbourne Annual Report 2009–10

GOAL THREE – ECONOMIC PROSPERITY

The sustainability and resilience of our municipality’s economy is critical.

The City of Melbourne will work locally, nationally and globally to continue to strengthen the local economy to ensure that we will be prepared and well positioned to meet the challenges of the global economy. We will pay particular focus on small and medium businesses, draw on the diversity of our local economy and educated workforce, and assist Melburnians to achieve prosperity through social enterprise.

HIGHLIGHTS

Enterprise Melbourne Launched in 2009–10, Enterprise Melbourne aims to promote and facilitate economic development for Melbourne. It also provides a single point of entry for information relating to business and economic activity in Melbourne. The program is supported by a high-level advisory board chaired by the Lord Mayor and includes an Enterprise Melbourne web portal, an alignment of activities already provided by City of Melbourne branches and a coalition between all levels of government and member-based organisations to provide a program of assistance to the Melbourne business community. The Enterprise Melbourne Board considered the outcomes of the Access Economics Financial Services Cluster Study in May. The study indicated that Melbourne has a vibrant financial services cluster grounded in two areas of competitive advantage, the superannuation sector and banking. The funds management sector is also identified as a key strength. Industrial land supply study Significant change will occur in both the nature and location of industrial areas over the next two decades as the City grows and as several major urban redevelopment projects come on line. An industrial land supply study was prepared in November 2009 to review existing studies, strategies and current trends. An industrial land supply committee was formed to review the recommendations from the study regarding the future use and zoning of land. Findings from the committee will inform the ongoing review of the Melbourne Planning Scheme. Social enterprise strategy This year the City of Melbourne developed a social enterprise strategy to build the capacity of partner organisations to contribute to social enterprise in the city. Enhanced social enterprise will assist people to move from dependence and welfare to independence and enterprise. Social enterprises can potentially provide a range of social and cultural benefits in addition to their contribution to economic prosperity. Implementation of the strategy will begin in 2010–11. Small business grants program In the past 13 years, the City of Melbourne small business grants program has made 253 grants, totalling over $5.4 million in investment to innovative small businesses operating in Melbourne. This year accounting firm KPMG completed a review of the program to ensure it aligns with the objectives of the council plan. The review found that the program does align to our economic development objectives, providing niche support to small business not provided by other levels of government. In 2009–10 13 grants, totalling $251,258 were approved by council.

City of Melbourne Annual Report 2009–10

The grants were:

• start up 4 • business expansion 5 • export entry 2 • business support 2

District Precinct Program The diversity and quirkiness of the many different retail precincts throughout the city make Melbourne an engaging city for residents, workers and visitors. The District Precinct Program supports the work of local business associations to market their special part of Melbourne. Through partnership with the Victorian Government, the District Precinct Program has resulted in investment in new infrastructure to celebrate Melbourne’s Chinatown, Greek precinct in Lonsdale Street and Italian influences in Lygon Street. Melbourne Retail Strategy 2006–2012 The Melbourne Retail Strategy 2006–2012 is a partnership between the Victorian Government and council. In 2009, The Future Laboratory (from London) were commissioned to undertake a mid term review of the strategy to identify key international trends that Melbourne needs to be aware of, to maintain its position as Australia’s leading retail destination. The outcomes of the review will influence future projects overseen by the Melbourne Retail Advisory Board. Sister city program The City of Melbourne is proud to celebrate over 30 years of international alliances through our sister city program. Over three decades ago, Melbourne with the Japanese city of Osaka, established our first sister city partnership. The program has flourished into an international network spanning the globe. Sister cities now include:

• Osaka, Japan (1978) • Tianjin, China (1980) • Thessaloniki, Greece (1984) • Boston, United States (1985) • St Petersburg, Russia (1989) • Milan, Italy (2004)

Melbourne’s relationship with its six siblings continues to blossom. Our multicultural communities and the city as a whole have been nourished by their influence, which extends from educational, cultural and sporting exchanges to unparalleled business networking opportunities. Activities this year have included the Thessaloniki Sister City Community Festival and a visit to Melbourne by the Mayor of Tianjin and his delegation of over 120 people to mark the 30th anniversary of our sister city relationship. In addition, a business development opportunity centred on the Salone de Mobile, Milan held in April 2010. A collective of export ready designers, alumni from RMIT, Monash and Swinburne universities, exhibited their design products.

City of Melbourne Annual Report 2009–10

Events in the city The City of Melbourne aims to position Melbourne, nationally and globally, as the events and lifestyle capital of Australia, by staging and supporting a diverse range of quality events, all year round. The variety of events and festivals encourage city visitors, while also celebrating the community’s diversity and talents and increasing cultural understanding and awareness. More than 135 events were hosted by the City of Melbourne in 2009–10. Major events this year have included the 50th anniversary of Moomba, New Years Eve in the city which included a family event in Yarra Park and Melbourne Spring Fashion week. This year has been a very successful year for events with record attendances and significant media coverage that served to enhance the City of Melbourne's reputation for its premier events.

LOOKING AHEAD

Supporting our economy The City of Melbourne plays an important role in shaping our vibrant local economy. Initiatives planned for the 2010–11 year include implementation of the Music Support Strategy, a CEO business consultation program, the development and implementation of a new model of the District Precinct program and the implementation of an international engagement framework.

Strategic Indicators

Strategic Indicators Actual Comments Community satisfaction rating for overall % 68 The City of Melbourne rates performance of economic development the highest performing council within the Inner Melbourne Metropolitan Council group. This result is also higher than all other Victorian Councils. Average number of daily visitors to Melbourne # 771,000 2008 data source municipality on a typical weekday Number of customer contacts at the # 782,812 The Melbourne Visitors Melbourne Visitors Centre Centre is Melbourne’s one- stop shop for all visitor and tourist information needs Number of businesses located in the # 16,800 This result is an increase. In Melbourne municipality 2008–09 it was 16,460

Level of investment by recipients of small $ 845,690 13 small business grants business grants awarded in 2009–10

City of Melbourne Annual Report 2009–10

GOAL FOUR – A KNOWLEDGE CITY

Melbourne’s appeal to the international education market and our world class research facilities are a sound basis for growing our potential and reputation as a knowledge city.

Enhancing our education, research and development, industry innovation, business and access to the world through information technology will ensure we remain at least a step ahead as a world-renowned knowledge city.

HIGHLIGHTS

International student program The City of Melbourne hosted a number of events this year aimed at enhancing the health, wellbeing and safety of international students who live, work or study in the city or just visit. Successful programs this year included the International Student Tourism Volunteer Program, Discover Melbourne, Project ARIES and the Women's Health Connect Project.

In partnership with RMIT University, in May 2010 the City of Melbourne launched the GLoBALL international students program. Coordinated by the Essendon Football Club and Cricket Victoria, GLoBALL enables international students and new migrants to interact with the broader Victorian community through Australian Rules Football and cricket related activities throughout the year. There are now more than 1000 international students signed up to this program.

Two Lord Mayor Student Welcome events were held in July and March to officially welcome new students to Melbourne and promote Australia’s culture, cultural diversity and inclusiveness. Hosted by the Lord Mayor, these events also gave various emergency and support network organisations an opportunity to promote their services to students. Activities at The Couch – International Student Centre In partnership with the Salvation Army and the Australian Federation of International Students, The Couch – International Student Centre has been operating this year. Under the supervision of a coordinator and 10 volunteers around 20 to 25 students attend the centre per night. A number of stakeholders have run workshops and forums at The Couch, including the Melbourne Fire Brigade, the Victorian Police, International Student Legal Advice Clinic, Multicultural Centre for Women’s Health, the Victorian Immigrants and Refugee Women’s Coalition, Australian Taxation Office and the Department of Immigration and Citizenship.

LOOKING AHEAD

The third World Knowledge Cities Summit The Office of Knowledge Capital has been successful in attracting the third World Knowledge Cities Summit (KCWS), which will be held from 16–19 November 2010 at the Melbourne Convention and Exhibition Centre. KCWS is a three day conference that will see leading academics and professionals from Melbourne, across Australia, and from other countries around the world, come together in the one place to explore new ideas about creating knowledge cities. The conference will showcase how Melbourne has progressed as a successful knowledge city, and enhance Melbourne’s reputation as a leading international

City of Melbourne Annual Report 2009–10

knowledge city with world-class learning and research facilities and strong economic and cultural foundations.

STRATEGIC INDICATORS

Strategic indicators Actual Comments International students studying in the city as a % 12.30 The City of Melbourne has proportion of total tertiary students continued to promote Melbourne as a knowledge city through International student programs Local students studying in the city as a proportion % 87.7 This figure decreased from of total tertiary students 88.2 per cent in 2006 despite an increase in the number of domestic students enrolled in the city. This is due to the number of international student enrolments increasing at a faster rate Number of primary, secondary and tertiary # 152 2008 data source educational facilities in the city Ranking in the 2 Think Now Innovative Cities # 19 This is an improvement from Index the 2008–09 ranking of 25

Ranking in the Global University City Top 20 # N/A External data source no World University Cities Index longer available. New strategic indicator to be developed in 2010–11

City of Melbourne Annual Report 2009–10

GOAL FIVE – AN ECO-CITY

Melbourne is a recognised leader in the field of sustainability.

Future Melbourne’s ambitious goals inspire us to improve the sustainability of the city’s building stock, reduce carbon emissions in all areas of city life and develop ways to capture, store and deliver potable water within the municipality and protect our world renowned parks and gardens.

Managing and improving the reduction and disposal of waste and promoting recycling and re-use is an increasingly important part of reducing our ecological footprint.

We have an important role to play in educating the people of our municipality and continuing to plan for and respond to climate change. We will work to ensure Melbourne is internationally recognised for our sustainability initiatives and as a leader in sustainable design.

HIGHLIGHTS

1200 Buildings Program The aim of the 1200 Buildings Program is to improve the environmental performance of commercial buildings, thereby reducing greenhouse gas emissions in the municipality. The program – a first of its kind in Australia – will create 8000 new green jobs and generate $2 billion in economic activity. This year, in the program's first year, 37 buildings made a commitment to improve their environmental performance and signed up to the program. Also, a strategic partnership has been developed between the City of Melbourne and the Victorian Government to support the future of the program and a partnership has also been developed with the Industry Capability Network to deliver a register of consultants and suppliers with capabilities to support building owners achieve the goals of the program. Drought proofing Melbourne’s parks and gardens Victoria’s drought has continued to negatively impact Melbourne’s parks and gardens. This year the City of Melbourne has implemented drought proofing initiatives in six of our major parks and gardens. Projects completed this year include the commencement of the installation of Australia’s first Australian Football League/Cricket Australia-standard synthetic sports surface at J.J. Holland Park; the expansion of a water harvesting project to bring reclaimed water to the Royal Park eastern sports grounds and Royal Parade trees and to develop rainwater harvesting solutions for Fitzroy Gardens, Birrarung Marr and Alexandra Gardens. We have also delivered projects in partnership with others, including the installation of a stormwater harvesting scheme at the Shrine of Remembrance. Drought proofing work will continue in 2010–11 as part of the City of Melbourne’s climate change adaptation program. Under this program, $5.7 million has been allocated to commence further stormwater harvesting works in Fitzroy Gardens, enhance the protection of Melbourne’s drought ravaged trees and to develop new landscapes and streetscapes that are more suited to the future climate change conditions. Tree planting to protect historic reserve Many of Melbourne’s grand boulevard trees and park trees at the Shrine of Remembrance reserve were planted more than 80–100 years ago, when the city’s climate was cooler and wetter. Some of these trees have struggled to survive in today’s drought conditions resulting in the removal of 106 dead or dying trees. As part of a five year landscape improvement plan for the area, 375 drought-tolerant trees will be planted to replace the lost trees. These

City of Melbourne Annual Report 2009–10

new hardy species will prosper in our reserve and ensure a healthier, more sustainable tree population for the long term. In addition to our focus on this reserve, over 3400 trees were planted across the municipality. 1500 of these trees were replacements for drought affected trees and 1900 were additional trees for the municipality. Establishment of parks and gardens advisory committee Technical experts from Parks Victoria, parks management and the Royal Botanical Gardens together with five strategic thinking community members this year joined to form a new City of Melbourne Parks and Gardens committee. This committee provides guidance in the ongoing future and development of the city’s parklands. Open spaces in the City of Melbourne are fundamental to the city’s liveability and play an important role in the heritage value, ecology and health and wellbeing of the city and its people. The advisory committee will play a significant role in providing feedback on plans and initiatives for our parks and provide advice on community engagement processes and programs. Tourism Melbourne green globe silver accreditation Tourism Melbourne is aiming to achieve Green Globe silver accreditation for its green building initiatives. All capital works contractors for the visitor services network are now requested to demonstrate sustainable and efficient work practices. Sustainable building initiatives have resulted in cost savings and fuel efficiencies for the centres. Green building practices include the use of recycled building materials, the use of acrylic paints, the installation of energy saving light bulbs and the use of non-toxic glues on external wrap decals. New eco-city forums Our new City of Melbourne eco-city forums provide the community with an opportunity to learn about the City of Melbourne’s sustainability programs and how individuals can contribute to achieving a sustainable city. Discussions this year have included our climate change adaptation strategy, green apartment living and the impact of climate change on our parks and gardens. Attracting over 250 participants, the forums have been delivered online via Twitter and held at a central location within the city. Zero Net Emissions by 2020 Strategy The Zero Net Emissions by 2020 strategy sets the City of Melbourne the target of achieving carbon neutrality by 2020 and identifies areas for improved efficiency and reduced energy consumption. Initiatives this year included:

• the Energy Savers – It All Starts at Home program, resulting in savings of just under 600 tonnes of greenhouse gas emissions per year • the CitySwitch energy program, which now has 58 signatories resulting in savings of 700 tonnes of greenhouse gas emissions per year for the first six signatories • the formal launch of the 1200 Buildings Program with 37 buildings signing up to the program. New image gateway system for photocopiers In order to reduce paper wastage and improve energy performance, we have established a number of key objectives with our printing and copying supplier. New image gateway systems have been installed on all printers, requiring employees to manually swipe their identity cards to release and print jobs. Printing jobs not released within 24 hours are automatically deleted, resulting in fewer prints. Since the new devices were installed in late 2009, over 80,000 impressions have been deleted. All printing devices are 100 per cent compliant in terms of low environmental impact paper, software based tools to help reduce environmental impact and the use of plant-based inks.

City of Melbourne Annual Report 2009–10

Reducing our ecological footprint The graph below shows the City of Melbourne’s total energy and renewable energy use. The City of Melbourne increased its renewable energy consumption this year by 17,275 gigajoules due to restructuring its energy contracts to increase green power purchases. A new energy performance contract will see 12 City of Melbourne buildings retrofitted with energy and efficiency devices in 2010–11.

The City of Melbourne consumes energy in the daily operation of its administration and buildings, community buildings such as child care centres, public lighting and its corporate fleet. We monitor the consumption of three major energy types – electricity, natural gas and automotive fuel.

City of Melbourne energy use by source

Energy use by Base 05–06 06–07 07–08 08–09 2 09–10 3 source year 1 (96–97) Electricity (Victorian 76,070 56,295 52,689 56,532 70,375 56,031 grid) Electricity 0 22,296 33,496 34,660 24,243 41,518 (Renewable GreenPower) Natural gas 14,626 14,171 14,172 18,157 19,276 20,871 LPG fuel 13,700 9,109 8,509 6,714 5,787 4,896 Unleaded petrol 0 199 193 431 477 495 Diesel 0 0 0 118 431 741 Total energy use 104,396 102,070 109,029 116,612 120,589 124,552 (GJ) Percentage 0% 20% 30.7% 29.7% 20.1% 33.3% renewable Source: Billing data including the corporate database ‘Stark Essentials’

1 In 1996–97 a baseline was established which became our ‘base year’. An investigation of our historical records has resulted in changes to these figures from previously reported results 2 Figures previously published for this year were estimates and adjustments have been made to reflect actual results available at the time of printing 3 Due to billing cycles this figures includes estimated calculations based on current and seasonal trends

City of Melbourne Annual Report 2009–10

City of Melbourne energy use by activity

Energy use by Base 05–06 06–07 07–08 08–09 2 09–10 3 activity year 1 (96–97) Administration – 18,632 20,202 19,388 22,356 21,967 20,476 buildings Administration – 13,700 9,308 8,702 7,264 6,695 6,132 fleet Commercial – 2754 3,156 2,988 3,434 3,094 4,610 buildings Community use – 21,668 18,747 22,407 23,977 26,016 28,668 buildings Community use – 46,412 50,406 51,574 55,549 57,933 57,917 public lighting Community use – 1230 251 3,970 4,033 4,884 6,749 miscellaneous Total energy (GJ) 104,396 102,070 109,029 116,612 120,589 124,552

Source: Billing data including the corporate database ‘Stark Essentials’

Total direct and indirect greenhouse gas emissions

Total emissions Base 05–06 06–07 07–08 08–09 2 09–10 3 year 1 (96–97) Emissions 31,165 23,563 19,506 20,638 25,339 20,520 (t CO2-e) Percentage from -24.4% -37.4% -33.8% -18.7% -34.2% base year Percentage from 2.8% -17.2% 5.8% 22.8% -19% previous year Source: Billing data including the corporate database ‘Stark Essentials’ (To reflect voluntary purchases of greenpower the calculations exclude greenpower purchased from the Victorian electricity grid)

City of Melbourne Annual Report 2009–10

The City of Melbourne’s total greenhouse gas emissions are down by 19 per cent or 4819 tonnes on last year’s readjusted result and a 34.2 per cent or 10,645 reduction from the base year. This reduction is largely due to an overall increase in the purchase of greenpower. Reducing water use Water is a precious resource. Its supply is under pressure from drought in the short-term and increasing population in the long term. The City of Melbourne has delivered a number of initiatives aimed at reducing our water use including the use of reclaimed stormwater from Royal Park’s Trin Warren Tam-boore wetlands, re-planting lawns and sports fields with warm season grasses, and installing more efficient subsurface irrigation systems. The City of Melbourne uses approximately six per cent of the municipality’s total water consumption. The majority of this water is used to irrigate parks and green open spaces.

City of Melbourne total water use

Total water use Base 05–06 06–07 07–08 08–09 2 09–10 3 for City of year 1 Melbourne (99–00) operations Potable (ML) 1,544 1,247 721 520 607 623 Reclaimed (ML) 0 0 30 87 73 90 Total water 1,544 1,247 751 607 680 713 Percentage from -19.2% -51.4% -60.7% -51.2% -53.8% base year Percentage from 2.3% -39.8% -19.2% 12% -4.9% previous year Percentage 0.0% 4.0% 14.3% 10.7% 12.6% reclaimed Source: Billing data including the corporate database ‘Stark Essentials’

1In 1999–2000 a baseline was established which became our ‘base year’ 2 Figures previously published for this year were estimates and adjustments have been made to reflect actual results available at the time of printing 3 Due to billing cycles this figures includes estimated calculations based on current and seasonal trends

Total water usage increased over the last financial year due to the ongoing drought, which required additional water to prevent long-term damage to our trees.

City of Melbourne Annual Report 2009–10

Water use by activity

Water use by activity Base 05–06 06–07 07–08 08–09 2 09–10 3 year 1 (99–00) Administration – buildings 11 8 7 4 4 9 Commercial – buildings 1 2 1 2 6 2 Community use – buildings 70 58 50 45 41 46 Community use – open space 1462 1179 693 557 629 656 Total water (ML) 1,544 1,247 751 607 680 713 Source: Billing data including the corporate database ‘Stark Essentials’

LOOKING AHEAD

Drought proofing our parks and gardens Drought proofing work will continue in 2010–11 as part of the City of Melbourne’s climate change adaptation program. Under this program, $5.7 million has been allocated to commence further stormwater harvesting works in the Fitzroy Gardens, enhance the protection of Melbourne’s drought ravaged trees and to develop new landscapes and streetscapes that are more suited to the future climate change conditions. 1200 Buildings – accelerating the program The 1200 Buildings program is expected to create over 8000 new jobs and generate more than $1.3 billion in economic activity, over the life of the program. In 2010–11 the program aims to increase the number of signatories by a minimum of 50, which will provide Melbourne the opportunity to solidify its environmental leadership in Australia. Community – delivering eco-city forums In 2010–11 we will build on the success of the eco-city forums, which were launched last year. Four forums are scheduled including a young people and sustainability forum and a forum on the council’s own environmental performance. Adapting Melbourne to climate change – continuing the ground breaking work The City of Melbourne will continue our work to ensure the municipality adapts to the impacts of climate changes. In 2010–11 we will:

• develop a strategy to maintain our urban forests • have a number of white roofs in progress • embed climate change adaptation into our organisation planning • continue to engage with city businesses and residents about the impacts of climate change and appropriate adaptation responses.

City of Melbourne Annual Report 2009–10

Residential buildings – making it easy for multi-story buildings to undertake environmental retrofits In 2010–11 the City of Melbourne will commence a residential energy efficiency program aimed at higher density dwellings. This program will identify solutions to institutional barriers in order to achieve energy efficiency retrofits in higher density residential buildings. These include ownership and governance structures, split incentives between owners and tenants and access to finance and funding.

STRATEGIC INDICATORS

Strategic indicators Actua Notes l City of Melbourne performance on refuse % 67 Indexed mean score recycling initiatives and effective and efficient water usage CO2 emissions per resident per year Tonnes 7.8 Data modelled in 2008 using 2006 national and state based data CO2 emissions per worker per year (across Tonnes 9.9 Data modelled in 2008 the municipality) using 2006 national and state based data Tonnes of greenhouse gas emissions for Tonnes 5.97 Data modelled in 2008 the municipality per year million using 2006 national and state based data Percentage of municipal waste diverted for % 25 This is an improvement recycling from 2008–09 figure of 22% Reduction of residential waste to landfill per % 5 Amount of waste to landfill household per household per year has reduced from 460kg in 2008–09 to 440kg in 2009– 10 Reduction of greenhouse gas emissions % 34.20 Percentage reduction from from City of Melbourne operations base year (31,165) Reduction of waste to landfill from City of % 29 Survey conducted every Melbourne facilities (offices) three years. 2009 data reported Number of commercial buildings retrofitted # 37 Below target of 50 for under the 1200 Buildings Program 2009–10 Reduction of drinking quality water % 59.70 Percentage reduction from consumed for City of Melbourne buildings base year (99–00) and gardens

City of Melbourne Annual Report 2009–10

GOAL SIX – A CONNECTED CITY

The City of Melbourne will focus on advocating for safe, efficient and sustainable movement throughout the city and make sure Melbourne is accessible in the broader regional and global context.

HIGHLIGHTS

Car sharing This year the City of Melbourne initiated a research project to identify the benefits and potential of car sharing in Melbourne. Car sharing is a unique transport option, enabling residents and businesses to reduce their use and dependency on private cars and facilitating their transition to public transport, cycling and walking. The outcomes of this research will form the basis of a new policy for council. Melbourne bike share program Delivered by the RACV on behalf of the State Government, the City of Melbourne joined forces to launch the Melbourne Bike Share program in May 2010. Ten bike docking stations have been opened around the central city, providing Melbournians with a public bike system as an alternative means of transport around the city. The City of Melbourne has supported the project by providing space for the bikes and docking stations on the street. Bike and pedestrian path on the new Manningham Street Bridge in Parkville This year the City of Melbourne launched a new cycling and pedestrian path on the new Manningham Street Bridge in Parkville. The new bridge enables efficient and safe crossing for cyclists and pedestrians over Manningham Street and provides a vital link between the east and west side of the Capital City Trail. New bike pod facility Melbourne’s first bike pod, providing public shower and change facilities for cyclists who ride into the city each day, was launched this year. The aim of the bike pod, located at the City Square car park, is to overcome the shortfall of change and storage facilities for cyclists in the city. In addition to the new showering and change facilities, the council is providing 32 off-street bike parking spaces within the car park. The pilot project, jointly funded by the City of Melbourne and the Department of Transport will also see a second pod installed at the RMIT car park in Cardigan Street next year. Hybrid and electric car fleet The hybrid Toyota Camry became available on the Australian market in March 2010 and the City of Melbourne purchased 10 vehicles to replace petrol vehicles within our fleet. These hybrid vehicles work by offering better fuel economy and lower carbon emissions.

Two of our electric motor vehicles and the electric bicycle fleet have been nominated to participate in the five year electric vehicle trial program that will be conducted by the Department of Transport in late 2010.

City of Melbourne Annual Report 2009–10

LOOKING AHEAD

127th IATA Schedules Conference in November 2010 Melbourne Airport is Australia’s largest 24 hour curfew-free airport and is located jus 22 km from the central city. In an important step to address the lack of international air services flying into Melbourne, the City of Melbourne is sponsoring the 127th International Air Transport Association (IATA) Schedules Conference. It is to be held in Melbourne in November 2010. This conference will provide a forum for the allocation of slots at fully coordinated airports and will showcase our city to major airlines and international airport delegates. Transport strategy In 2006 the municipal transport strategy, Moving People & Freight, was developed to guide council decision making regarding improved mobility and access to and around the City of Melbourne. Since then, many of the initiatives and aspirations of Moving People and Freight have been achieved. There has also been a general change in transport patterns and behaviour in Melbourne. For these reasons, the City of Melbourne will be reviewing Moving People and Freight in 2010–11. The new transport strategy will ensure Melbourne is well placed to deal with some of the big challenges facing the city in the next 20 years.

Strategic indicators

Strategic indicators Actual Notes City of Melbourne performance promoting the use % 73 Indexed mean score (as of public transport perceived by residents) City of Melbourne performance on the quality and % 69 Indexed mean score (as coverage of bike paths and footpaths and perceived by residents) convenience of walking around the central city Community satisfaction rating for overall % 68 The City of Melbourne rates performance on local roads and footpaths the highest performing council within the Inner Melbourne Metropolitan Council group. This result is also higher than all other Victorian Councils. Community satisfaction rating for overall % 55 Performance remained performance of traffic management and parking unchanged from 2008–09, facilities but continues to be lower than the Inner Melbourne Metropolitan Council group and all councils. Mode share for public transport, motor bikes, % 48 Biennial survey last walking and cycling of Victorian city users conducted in 2008

City of Melbourne Annual Report 2009–10

GOAL SEVEN – LEAD BY EXAMPLE

The City of Melbourne is committed to ensuring we continue to be highly regarded for leadership and our ability to achieve the best outcomes for the community. This includes excellence in governance and organisational practices.

HIGHLIGHTS

Corporate PR strategy Drawn from the four year council plan goals and focusing particularly on yearly key strategic activities, the corporate PR strategy identified a combination of proactive media and marketing and communications activities to highlight the leadership that council brings to the City of Melbourne and ensures the work and achievements of council are known and understood by multiple stakeholder groups. 2010 Year of women in local government This year is the year of women in local government. The primary focus for the year is to raise awareness of the opportunities for, benefits of, and the need to increase the participation of women in leadership and management roles within local government, inclusive of both elected representatives and paid personnel. To support the year of women in local government, in March 2010 the City of Melbourne hosted the Australian Local Government’s Women’s Association Victoria conference. Management challenge In March 2010, 12 City of Melbourne future leaders participated in the Local Government Managers Australia (LGMA) management challenge, a leadership development program for local councils across Australia and New Zealand. One of the City of Melbourne’s teams won first place in the Victorian competition, going onto successfully compete in the Australasian finals. New corporate brand for the City of Melbourne In late July 2009, the City of Melbourne launched a new corporate brand. The new ‘M’ logo reflects a city that is recognised internationally for its diversity, innovation, sustainability and liveability. The new brand has progressively been adapted to the organisation’s communications material to consolidate awareness of the services we provide. The City of Melbourne corporate website also underwent a major redesign this year to improve navigation and usability. Corporate reporting framework In a first for Australian capital cities, this year the City of Melbourne developed a corporate planning and reporting framework. This framework includes a policy, business rules and handbooks to assist staff with corporate reporting requirements. The new framework has elevated the quality and standard of City of Melbourne reports on corporate performance. Transforming Australian Cities The Transforming Australian Cities report is a study into how Melbourne might accommodate major population increases sustainably by 2030. It was jointly commissioned by the City of Melbourne and the Victorian Department of Transport. The research includes Melbourne case studies and presents a well-researched argument for strategic residential and employment intensification along public transport corridors. The study was one of two

City of Melbourne Annual Report 2009–10

recipients of this year’s prestigious urban design award, the Australia Award for Urban Design. Engaging our community Developed this year, the City of Melbourne’s community engagement framework provides policy and operational guidance for all parts of the organisation in planning and implementing community engagement activities. The framework aims to support a consistent and high quality approach to engagement with our community and assists management understand community needs so as to better inform council decision making. Community engagement opportunities have included the councillor community forum held in August 2009, extensive community engagement for the Swanston Street redevelopment and the Chinatown precinct lighting project.

LOOKING AHEAD

City of Melbourne as a centre for learning and excellence Parking & Traffic is a recognised leader in the training of authorised officers within the parking industry. In order to expand our current service provision, Parking & Traffic will work to develop a feasibility study to investigate the opportunity to create a centre for learning excellence as a Registered Training Organisation. This feasibility study will research the current professional development opportunities offered by other providers, and ascertain if the City of Melbourne is best placed to provide such learning in the coming years.

STRATEGIC INDICATORS

Strategic indicators Actual Notes City of Melbourne participation at the # 10 Attendance at all 10 meetings Council of Capital City Lord Mayors (2), in 2009–10 Inner Melbourne Action Plan (4) and Melbourne Metropolitan Mayors Forum (2) Community satisfaction rating for % 64 Performance improved from council’s advocacy and community 2008–09 to be similar to the representation on key local issues Inner Melbourne Metropolitan Council group and is now on par with all councils Community satisfaction rating for % 73 Performance remained council’s interaction and responsiveness unchanged from 2008–09, in dealing with the public however is similar to the Inner Melbourne Metropolitan Council group and all councils. Community satisfaction rating for overall % 68 Performance remained performance generally of the council unchanged in 2009–10, a similar score to the Inner Melbourne Metropolitan Councils group.

City of Melbourne Annual Report 2009–10

GOAL EIGHT – MANAGE OUR RESOURCES WELL

Our programs and training will focus on attracting and retaining a highly skilled workforce and all commitments that we make will be supported from a diverse revenue base.

We recognise that revenue will be impacted by global finances and we will continue to monitor our corporate performance and strive to achieve efficiencies while maintaining high standards of service.

HIGHLIGHTS City of Melbourne maintains AAA credit rating The City of Melbourne’s financial outlook is ‘strong and stable’ according to Standard and Poor’s who this year affirmed the City of Melbourne’s longstanding AAA credit rating. Melbourne is the only local government in Australia that is AAA-rated. Our prudent financial management gives the City of Melbourne the capacity to invest in infrastructure and keep rate rises at a minimum while maintaining the flexibility to meet any unexpected challenges.

Lean Thinking Lean Thinking is a way of improving value for customers by improving efficiency through problem solving and continuous improvement. This year the organisation completed 10 Lean Thinking programs. Improvements include increased revenue through more effective parking meter maintenance, a reduction in the number of days to issue construction zone permits, improved services in the child care centres, a reduced advertising spend in recruitment, and an improved and standardised issues management system.

Customer Focus Strategy This year the City of Melbourne introduced a new Customer Focus Strategy, outlining our commitment to being a leading customer focused organisation. We aim to exceed expectations by engaging with the community, delivering simplified processes and improving our response time on customer service requests. The Complaints Resolution Process was launched during Focus on Customer Week in March 2009. Recent research has shown that how an organisation responds to a complaint is critical to a positive resolution and the overall customer experience. We recognise that when a complaint is received, it is important to take action to address the underlying cause. Over the last year there have been many instances where lessons learned from a complaint have lead to a service improvement. To cite one notable example, feedback from customers led to a Lean Thinking review of faulty parking meters which reduced customer reports of faulty meters by 36 per cent. Meter related customer contacts are now at their lowest level in five years.

Integrated survey strategy This year the human resources team developed an integrated survey strategy utilising the organisation’s Intranet. The objective of the strategy was to streamline the communications of three annual surveys (culture, diversity and internal service provider surveys). This new direction resulted in stronger participation in all three surveys. Diversity framework In April 2010 we undertook our first diversity census, inviting participation from all staff across the organisation. Our organisational strengths were that staff felt welcome and respected at work, and felt they were treated fairly. Staff also felt they had access to professional development and training opportunities, and felt safe from bullying and harassment.

City of Melbourne Annual Report 2009–10

Zero based budgeting In 2009–10, the City of Melbourne introduced a new zero based approach to budgeting. As an introductory year, it was prudent to limit the scope to four branches. The positive results that came from zero based budgeting included enhanced transparency of council’s expenditure, detailed justifications for budget allocations and an increased level of savings. Given the positive outcomes, the council is looking to continue with zero based budgeting next year. This approach to budgeting is another way that council works to ensure a financially well managed organisation.

LOOKING AHEAD

Lean Thinking program for 2010–11 In 2010–11, CoMLean will be focusing on organisation-wide culture change, starting at the top by working with directors and managers to lead improvement work with their staff, looking at high volume processes or significant problems in their area. The City of Melbourne will become a leading improvement institution, identifying waste in processes, making problems visible, and working with staff to deliver improved services to our community.

STRATEGIC INDICATORS

Strategic indicators Actual Notes Percentage of planned council works programs % 90.8 The value of completed completed works was $72 million compared to an overall budget of $80.7 million Liquidity Ratio of greater than 1.5 # 3.07 This demonstrates a strong financial position for City of Melbourne and ensures was are able to meet any financial commitments as and when they arise Maintain a positive underlying surplus $ 15.5 million The City of Melbourne has continued to deliver a positive underlying surplus which enables us to direct funds to important infrastructure works and continue our high level of service to the community Percentage of our customers satisfied with the % 84 2009–10 is a baseline overall customer experience when contacting the year for this indicator City of Melbourne

City of Melbourne Annual Report 2009–10

Staff retention rate % 90.40 This has decreased from the 2008–09 retention rate of 92.1 per cent Staff satisfaction rating (out of a possible rate of 7) # 5.58 This is an improvement from the 2008–09 figure of 5.44 Maintain safety standard accreditation against % 100 Standard maintained AS/NZS:4801 from 2008–09

City of Melbourne Annual Report 2009–10

CITY OF MELBOURNE 2009–10 PERFORMANCE STATEMENT Performance against Key Strategic Activities (KSAs)

In accordance with Section 127 of the Local Government Act 1989 (Vic), the City of Melbourne must provide a description of Key Strategic Activities (KSAs) to be funded in the 2009–10 Annual Plan and Budget.

Each year the City of Melbourne conducts a thorough planning process to identify the KSAs. For 2009–10, the 11 KSAs were geared toward:

1. Business development: At the time the 2009–10 Annual Plan was established, the potential impacts of the global financial crisis were not yet known. The City of Melbourne developed KSA 5 and 6 to ensure city businesses and the city economy were well supported.

2. Urban amenity: KSAs 1, 7, 8 and 9 were developed to further strengthen Melbourne’s high quality urban environment.

3. A sustainable environment: KSAs 2, 3 and 4 continue the City of Melbourne’s commitment to a sustainable environment and adapting the city to climate change.

4. Effective organisation: The City of Melbourne recognised that an effective organisation makes decisions that are in touch with the needs of stakeholders and are informed by the long term financial impacts of its actions. KSAs 10 and 11 were chosen to ensure a strong focus was applied to maintaining an effective organisation.

For the first time, the City of Melbourne adopted the framework from the Victorian Auditor General’s Office Better Practice Guide to prepare the KSAs. In doing so, we developed cost, time, quality and quantity measures and targets for the KSAs. Depending on the nature of the KSA some of these elements were found to be more relevant and material than others, therefore not all KSAs have measures and targets for all four elements.

Where the council is reliant upon a third party to complete a KSA target, only the performance of the council has been considered when making an assessment of achievement. The following Performance Statement outlines the City of Melbourne's achievement against the 11 KSAs for 2009–10.

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KSA 1 – Progressively implement changes to the Melbourne Planning Scheme based on the 2008–2009 audit, for approval by the Minister for Planning

The City of Melbourne is required to review the Melbourne Planning Scheme every four years. The City of Melbourne has completed an audit of the scheme and is working on projects aimed at the ongoing revision and improvement of our planning provisions. Over the next four years there are approximately 15 projects that the City of Melbourne will be leading which will inform changes to the planning scheme. In 2009–10 a number of studies and reviews will be completed, which will inform the review of the Melbourne Planning Scheme via the Municipal Strategic Statement (MSS) in 2010–11. Projects to be completed this year include the draft Student Housing policy, the Industrial Land Supply Study, a review of the draft Urban Design Strategy and a review of the Central City Built Form provisions.

ANNUAL PLAN MEASURE TYPE TARGET COMMENTS Materials and services costs Cost $295,315 $335,968 The costs for this project were not separated therefore the two cost measures target totalled $695,315 and the total spend was $505,615. The project was under budget as not all staff costs were required. Staff (existing) costs Cost $400,000 $169,647 Please refer to the above comments. Adopt and implement Industrial Land Time Oct 2009 100% Supply Study The Industrial Land Supply Study was developed and endorsed by the Future Melbourne Committee in June 2010 who resolved to incorporate its high level findings (urban renewal areas) into the new MSS. Review and revise the MSS Time Dec 2009 100% A revised draft of the MSS was endorsed for exhibition by the Future Melbourne Committee in April 2010. The Minister approved the exhibition in June 2010. The exhibition concludes in September 2010 with an expected completion date of mid 2011. The City of Melbourne has completed the portion of the project activities due this financial year. On the whole, the planning scheme amendments take over 18 months to reach completion. They are therefore difficult to conclude within any given financial year. The planning scheme amendment process involves council

74 City of Melbourne Annual Report 2009–10

endorsement, minister approval, an independent panel hearing, a panel report to council and then council reporting back to the minister. Southbank structure plan stage 2 Time Mar 2010 100% The council's strategic plans for Southbank have been reviewed and used to inform the new Draft Southbank Structure Plan which was endorsed for exhibition by the Future Melbourne Committee in May 2010. Council to consider Heritage Gaps study Time June 45% and policy for the Capital City Zone 2010 The Heritage Gaps study and revised heritage policy for a Capital City Zone project, in consultation with key stakeholders, was re-scoped to include the development of a Heritage Strategy that will address the study gaps and policy elements. A consultant was appointed in late June 2010 and the first inception meeting held in July 2010. The Heritage Strategy will now be completed as part of the Melbourne Planning Scheme KSA in 2010–11. We have indicated a 45 per cent completion due to the re-scoping of the strategy, which in turn delays the Heritage Gaps study. Commence an Urban Densification Time June 100% Strategy for transport corridors in the 2010 The council's Urban Densification Strategy, which focuses on the proposed City of Melbourne Melbourne Metro One rail corridor, was developed in close collaboration with the Department of Transport (DoT) in April 2010 and subsequently incorporated into council's new MSS. Develop and implement Student Time June 100% Housing Policy in the MPS 2010 A draft Student Housing Policy was prepared for the Future Melbourne Committee in February 2010 however the Committee deferred consideration until April. At the April committee meeting the policy was endorsed for exhibition as an amendment to the MPS. The Student Housing Policy is currently out for exhibition until the end of August 2010. The City of Melbourne has completed the portion of the project activities for which we were directly responsible. Some delays were experienced in obtaining minister approval to exhibit.

75 City of Melbourne Annual Report 2009–10

Review the Central City Built Form Time June 100% provisions and begin introducing 2010 The Central City Built Form provisions refer to the Hoddle Grid, Southbank council’s Urban Design Strategy into and Docklands and have been addressed in the development of both the MPS Urban Design Strategy and Southbank Structure Plan. Both have been included into the Melbourne Planning Scheme by inclusion in the MSS. Develop planning mechanism to Time June 70% increase the provision of affordable 2010 The provisions for affordable housing options, developed in partnership with housing options with Inner Melbourne IMAP councils, has received conditional support from the Minister for Action Plan (IMAP) and Inner Regional Planning, advising that further engagement with development industry peak Housing Working Group (IRHWG) bodies is required. These provisions will now be progressed in 2010–11. Percentage of components delivered as Quantity 100% 82% planned Three of the eight components have not been fully completed in 2009–10. On the whole, planning scheme amendments take over 18 months to reach completion therefore are difficult to conclude within any given financial year. Council approval of planned Quality 3 by 4 by June 2010. components June 2010

76 City of Melbourne Annual Report 2009–10

KSA 2 – Establish and start implementing new commercial waste collection standards

Following consultation with business and waste companies, new commercial waste standards were adopted by council on 15 December 2009. These new standards will ensure a more clean and welcoming city and encourage city businesses and waste collectors to take more responsibility for laneway cleanliness and presentation. Enforcement of the revised ‘Activities Local Law’ will begin on 1 July 2010.

ANNUAL PLAN MEASURE TYPE TARGET COMMENTS Materials and contractors Cost $76,500 $77,566 Project was managed to budget. Minor variance. Commercial waste standards developed and Time June 100% adopted by council 2010 Standards adopted by council on 15 December 2009 with the enforcement of local law amendment commencing on 1 July 2010. Registration requirements for waste Quantity 100% 100% companies are fully documented and Letter to waste companies including the permits to collect waste were explained to waste companies prepared and sent in February 2010. The permits are available online. The hotspot areas where waste companies cannot collect waste between 11pm and 6am have been identified in conjunction with the Victorian Waste Management Association. There has been additional communication with businesses through precinct meetings and press articles. Two new staff positions to implement the waste standards have been funded in the 2010–11 Annual Plan and Budget and will be advertised in the first week of July 2010. Reduction in the number of noise complaints Quality 10% N/A related to commercial waste management in This quality measures cannot be reported this financial year due to the the CBD over a 12 month period enforcement of the Local Law amendment commencing from July 2010.

77 City of Melbourne Annual Report 2009–10

KSA 3 – Facilitate the energy and water retrofit of commercial buildings in the municipality through the 1200 Buildings campaign, in partnership with other organisations

The aim of the 1200 Buildings Program is to improve the environmental performance of commercial buildings, thereby creating economic uplift in the form of spending on goods and services and reducing greenhouse gas emissions in the municipality. The program, a first of its kind in Australia, will create 8000 new green jobs and generate an estimated $1.3 billion in economic activity. This year a strategic partnership has been developed between the City of Melbourne and the State Government to support the future of the program. In addition, a partnership has been developed with the Industry Capability Network to deliver a register of consultants and suppliers who can provide services to 1200 Building signatories.

ANNUAL PLAN MEASURE TYPE TARGET COMMENTS Consultants Cost $100,000 $181,348 The costs for this project were not separated therefore the two cost measures target totals $320,000 and the total spend was $327,819. The project was managed to budget. Minor variance. Staff (existing) Cost $220,000 $146,471 Please refer to the above comments. Sustainable Melbourne Fund Cost To be N/A (SMF) partner contributions determined SMF not yet formally involved. Governance arrangements Time March 2010 100% City of Melbourne approved the SMF Charter and a Memorandum of Understanding to define the SMF's and City of Melbourne's role in delivery of the 1200 Buildings program. It is expected that the charter amendments will be in place by late 2010, this sits with the minister for approval.

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Identify sources of finance Time March 2010 100% Two sources of funding have been identified, one with confirmed funding and the other awaiting confirmation. The City of Melbourne developed a strategic partnership with the State Government which includes $500,000 grant to support the program. The funding will also be used to undertake the necessary legislative changes to enable an innovative financial mechanism, which will be delivered by the Sustainable Melbourne Fund. The Australian Carbon Trust has indicated that it is interested in partnering with the 1200 Building Program but an outcome will not be known until September 2010. Electricity grid policy Time March 2010 N/A Not progressed – this project was discontinued in January 2010 following a lack of participation from the distribution network business. Identify industry capability Time March 2010 100% Established a partnership with the Industry Capability Network (ICN) to deliver a register of consultants and suppliers who can provide services to 1200 Buildings signatories. The ICN will start delivering this register in the 2010–11 financial year. Support package and business Time March 2010 100% case for owners and align Owner segmentation – council has engaged in extensive consultations with regulatory incentives State Government (Department of Planning and Community Development, Department of Sustainability and Environment, Department of Treasury and Finance and Department of Premier and Cabinet) to seek funding for the program and to seek legislative amendment to the City of Melbourne Act to enable council to establish a financial mechanism that would assist building owners to access low cost financing. Building owner and segmentation report provided by Arup. Economic uplift report by Deloittes and market analysis report by TKP. In April 2010 the Premier announced support of the proposed legislation in Victoria’s Action Plan for Green Jobs. This is expected to be introduced at the end of July 2010.

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Marketing and communications Time June 2010 100% including website in place Website went live in November 2009. In March 2010 the web design project documentation was finalised, providing the business case and next steps required to develop the website to meet the needs of the target audience (building owners and facility managers). This documentation will guide the ongoing development and delivery of the 1200 Buildings website. On 31 March 2010 the first 30 buildings into the program were welcomed with a gala lunch launch hosted by the Lord Mayor. Retrofits underway Quantity 50 36 This measure is calculated by the number of buildings that joined the 1200 Buildings program in the 2009–10 financial year. The Lord Mayor welcomed the first 30 buildings to the program on 31 March 2010. An additional six buildings joined the program between 1 April and 30 June 2010, bringing the total to 36 buildings or 72 per cent of the target. An additional 20 buildings are close to signing up. This target was not met as the City of Melbourne was focused on responding to State Government needs to progress legislation through parliament. Additionally, the City of Melbourne was unable to complete the development of the marketing strategy to support this activity within the required timeframe. Stakeholders registered on 1200 Quality 1000 95 buildings website. This measure is calculated by the number of stakeholders who registered on the 1200 Buildings' website. In the 2009–10 financial year 95 people registered on the website or 9.5 per cent of the target. The market research conducted as part of the development of the 1200 Buildings program established that a building owners and facility managers were unlikely to see benefit from registering on the website at the early stages of the program before the program offerings were clear. Due to this finding the City of Melbourne did not focus on encouraging stakeholders to register on the website.

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KSA 4 – Continue to implement drought proofing to ensure water security for Melbourne’s parks and gardens

Strategic planning for the effective drought proofing of the city’s major parks is continuing due to the severe drought across the state which has resulted in Stage 3 water restrictions being imposed by statutory water authorities. Drought proofing and stormwater harvesting projects have been identified in Holland Park, Royal Park, Carlton Gardens, Fitzroy Gardens, Birrarung Marr and the Alexandra Gardens.

ANNUAL PLAN MEASURE TYPE TARGET COMMENTS Stormwater harvesting and drought proofing Cost $2 million $1,300,000 projects in Royal Park, Birrarung Marr, Fitzroy The installation of the synthetic surface at JJ Holland Park Gardens, Carlton Gardens and the Alexandra was reliant upon a Funding Grant from the State Gardens Government. The timing of the notification from the State Government of the successful application for funding resulted in delays in the commencement of the project. The remaining $700,000 in unspent funds has been carried forward into 2010–11 to complete the installation of the synthetic sports field at JJ Holland Park which is due for completion by the end of September 2010. Implementation timeframe Time June 2010 Three of the four sub-projects have been completed. The Holland Park synthetic sports field is currently in progress and will be completed in September 2010, hence the 95 per cent completion rating. Number of drought proofing projects completed as Quantity • Installation Construction was delayed on the installation of one synthetic planned of one sports field for Holland Park as a result of funding synthetic requirements which were secured in February 2010. sports field Contract works commenced in June 2010 and the field is • Completion expected to be completed and ready for use in September of Royal Park 2010. sporting fields The contract for the Royal Park Wetlands Extension to and Royal provide reclaimed water to the Eastern sports grounds and Parade Royal Parade trees has been completed. irrigation

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• Installation The Museum has awarded the contract for rainwater of rainwater harvesting infrastructure in the Western Forecourt project. A harvesting in portion of the water from the total project (27 per cent or Carlton approximately 450,000 litres storage capacity) will be Gardens provided to Carlton Gardens South in return for a council grant of $300,000. Payment to the Museum was in June 2010. Seek federal and state grants to support funding Quantity Commence The application to the National Urban Water and Desalination for drought proofing and stormwater harvesting documentation Program for the stormwater proposals' has been lodged of drought seeking up to $4.88 million which equates to 50 per cent of proofing / the Fitzroy Gardens, Birrarung Marr and Alexandra Gardens stormwater proposals. The result is now expected in July (not May, as harvesting previously reported). Further design work is being carried initiatives for out. Fitzroy Gardens, Alexandra Gardens and Birrarung Marr Mega-litres of additional reclaimed water used for Quality 40 mega-litres Ecological engineering report showing an additional 40 mega- watering Royal Park sports fields and Royal litres of harvested stormwater going to eastern sports field Parade trees and Royal Park streetscape.

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KSA 5 – Establish a ‘one-stop shop’ economic development model for Melbourne

A ‘One Stop Shop’ economic development model was recognised as a key priority of the City of Melbourne’s Council Plan 2009–13. A new approach to economic development for Melbourne was endorsed with a recommendation to establish a high level advisory board of Melbourne business community members to drive economic development priorities and strategies for Melbourne. The new advisory board will be known as Enterprise Melbourne. Other activities in 2009–10 will include the implementation of an online business portal and a three to five year economic development strategy for Melbourne.

ANNUAL PLAN MEASURE TYPE TARGET COMMENTS Establish ‘Enterprise Melbourne’ board, web Cost $350,000 $204,067 portal and business program $350,000 was allocated by the City of Melbourne primarily to implement the Enterprise Melbourne web portal. The development of phase one of the web portal was essentially completed in-house using existing and contracted labour. The level of expenditure required was less than anticipated. Establishment of advisory board, completion of Time Dec 2009 100% web portal, program of business activity In August 2009, council approved the terms of reference and scope of board membership. The first meeting of the board was held on 5 October 2009, with subsequent meetings held on 17 February 2010 and 19 May 2010. A draft economic development framework, which maps Melbourne's key industry sectors and the current scope of council activities to support these sectors was prepared for the May board meeting. Due to time constraints, consideration of this matter was deferred to the August Enterprise Melbourne board meeting. Each Enterprise Melbourne board meeting during 2009–10 has focused on a specific issue that impacts the Melbourne business community and opportunities for economic development. The advice generated from these board meetings has helped form the basis of the International Engagement Framework adopted by the City of Melbourne in April 2010.

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The four elements of the framework are: • Business prosperity – increasing exports and inwards investment in Melbourne's key industry sectors • facilitating learning – increasing exchanges in areas of city management excellence • supporting community, cultural and civic links • participating in international governance issues – advocacy and representation of Melbourne's interests in international forums. The Enterprise Melbourne portal (phase one) was rolled out 30 November 2009. Development continues for phase two of the website in conjunction with the delivery of the corporate website, and this will include online transactional capability. Level of awareness and participation Quality Baseline The Enterprise Melbourne eNewsletter commenced in February with year further editions in April and June. eNewsletter subscriber numbers have grown from 171 in February to 450 in June. Ongoing promotion of the website continues to drive business events listings with 76 events listed from January to June. Usage statistics regarding the Enterprise Melbourne website tell us that there have been 208,227 page views from November 2009 to June 2010.

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KSA 6 – Determine and agree upon a long term strategy for the Queen Victoria Market site

The Queen Victoria Market (QVM) is the last remaining 19th century market operating in central Melbourne. It is one of Melbourne’s most visited tourist attractions and one of Melbournian’s most loved local icons. To ensure the QVM’s future as the focal point of a growing, vibrant city neighbourhood, the City of Melbourne will work with key stakeholders to develop a shared vision for the site.

ANNUAL PLAN MEASURE TYPE TARGET COMMENTS Consultants to work with City of Cost $100,000 $135,886 Melbourne and QVM board to (council The approved budget of $100,000 was based on an estimation of staff time required develop options contribution to deliver the project and the necessary design consultants to initiate discussions for = $50,000 future progression of the project. The final cost of $135,886 was significantly plus higher than budget due to the requirement to workshop the options for the project, matching engaging time-lapse photography around QVM and other consultants that were not funds from planned at the time that the budget was approved. Overspend of the original budget the QVM was offset by surplus funds from the City Design operating budget. Options presented to council Time June 2010 80% The process to determine and agree on a long term strategy for the QVM site has progressed substantially however it is not yet finalised. A series of workshops with the City of Melbourne and QVM board have resulted in a number of options for a long term strategy for the QVM. Throughout the year, several research works were completed. They will inform the development of the long term strategy. These included an impact assessment of the relocation of the wholesale market from Footscray to Epping, a preliminary development assessment of the carpark site, a market research brief, streetscape analysis and a heritage assessment. As a result of the complex scope of this project, a decision on the long term strategy of the QVM site will continue throughout 2010–11. A QVM sub-committee was appointed in July 2010 to guide the future direction of the project with presentation of a final report to council in June 2011. Once a preferred option is agreed, the council will undergo a community engagement process. Agreeing on the preferred option for the QVM site is a key strategic action for 2010–11.

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KSA 7 – Commence implementation of the approved strategy for Swanston Street though documentation and schematic design

Swanston Street is one of the city's busiest streets. In 2008–09 the City of Melbourne sought feedback from key stakeholders and the community on how we could revitalise Swanston Street into a more attractive and accessible street. With a reduction in motor vehicle access being the preferred option, the City of Melbourne has developed a detailed project plan to manage the revitalisation project. Delivered through a staged approach, this year we will commence implementation of stage one.

ANNUAL PLAN MEASURE TYPE TARGET COMMENTS Cost of design and documentation including Cost $500,000 $499,870 tender documents Project was managed to budget. Minor variance. Ready to commence construction in Time June 2010 95% 2010–11 Commencing work on the Swanston Street redevelopment was defined as stage one. That included design, design development and conducting the road closure process. Design development is now well advanced and was approved by the project control group and interagency steering committee during May. It now requires council endorsement to proceed to the tendering phase. The road closure process commenced in April and submissions have now closed. Submissions were considered during June and will be referred to council in July for a decision. Councillors have been briefed of a revised construction timetable commencing on site in January 2011 to avoid the city's Christmas shopping peak and to work in with Yarra Trams and Melbourne Central construction plans.

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KSA 8 – Establish a partnership with the State Government to implement enhanced late night taxi ranks

The City of Melbourne aims to establish two enhanced taxi ranks per year for the next four years. These taxi ranks will operate within the hours of 11pm and 5am on Friday and Saturday nights. Enhanced taxi ranks will improve the reliability and frequency of taxi services and provide a comfortable and secure environment for both patrons and drivers at the selected sites. This project will be delivered in partnership with the State Government and other key stakeholders.

ANNUAL MEASURE TYPE TARGET COMMENTS Develop concept plan and seek Cost $100,000 $72,237 external funding for community The issue required consultation with external stakeholders as well as development of village a concept plan. The consultations took longer than expected delaying the ability to implement some strategies within the timeframe. This resulted in the under spend on the 2009–10 budget. These issues are expected to be addressed in KSA 2 for 2010–11. Plan and install two new enhanced Cost $250,000 $13,640 (2009–10 capital expenditure) city taxi ranks (External $50,000 grant ($15,000 in 2009–10 and $35,000 in 2010–11) funding) The City of Melbourne was successful in receiving $50,000 from the Victorian Taxi Directorate, which has been allocated to improve the infrastructure at the Queen Street rank. The original plan was to install two new enhanced ranks that provided taxi totem signs which would allow a customer to activate a security camera that monitors activity at the particular rank, and the installation of one new on-street toilet in the vicinity of the new rank. When this application received an allocation of $50,000 the scope of the project was modified to extend the length of an existing enhanced rank in Swanston Street adjacent to the Flinders Street Station at a cost of approximately $6000. It also included installation of a night time enhanced rank on the west side of Queen Street between Bourke Street and Little Collins Street. This rank did not include the installation of a taxi totem sign but involved the installation of overhead security cameras that could look at activity at the rank but was not activated by the rank's infrastructure. The new rank involved new signage at a cost of $1000. Upgrading the street light cost $35,000 and the installation of removable queue control barriers cost approximately $14,000. Security staff were also deployed on Friday and Saturday evenings at an estimated cost of $70,000 per annum from the operating budget.

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Enhanced taxi ranks installed and Time June 100% operational 2010 Communication plan prepared to guide promotion of the new enhanced taxi ranks. Promotional activities in 2009–10 included: • Updates on the That’s Melbourne website • Updates on the City of Melbourne website • Joint media opportunity with Department of Transport. Future communication activities include corporate advertisements, Melbourne News articles and promotion via the regular Lord Mayor segment on 3AW. A project control group met throughout the year to monitor activity levels, discuss security related issues, assess the functionality of the current locations and to plan future projects. Number of enhanced late night taxi Quantity 2 2 ranks Enhanced ranks in Queen Street and Swanston Street completed. Both these ranks are now being heavily used by taxis and passengers and their success has been endorsed by the Victorian Taxi Association. Positive feedback from Victorian Quality Positive Village Well, a consultant, was engaged to undertake an initial survey of late night taxi Taxi Association, Victorian Taxi feedback patrons in August 2009. The report Enhanced Taxi Ranks Activation Plan identified issues Directorate and Victorian Taxi received that need to be considered when considering the location and the amenity requirements Drivers Association indicating for any taxi rank in the CBD. reduction In April 2010, Village Well was commissioned to undertake a second survey to identify in anti- any changes in the attitude of patrons using the new enhanced taxi ranks. The survey social was based on the same criterion used in the August survey. It was conducted between incidents. 10.00pm to 2.00am and there were 109 documented responses. The consultant's report concluded: • taxi patrons will default to hailing a taxi if there is no obvious rank nearby • patrons are unlikely to walk long distances to find a taxi • Flinders Street Station and Crown Casino are the most well known taxi rank locations • the highest percentage of patrons leave the city between midnight and 3am • patrons are more likely to use a taxi rank if it is enhanced with information, security or a taxi marshal.

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The stakeholder reference group included Victoria Police, the Salvation Army and Rotary. The Salvation Army has been identified as the key external partner.

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KSA 9 – Commence rejuvenation of the Kensington Town Hall and establish a framework for the rollout of community centres across the municipality including in Carlton, Southbank and Docklands

The City of Melbourne has a diverse range of community infrastructure, much of which was developed historically and in an unplanned manner. This has lead to facilities that are uneven in coverage and capacity across different neighbourhoods, and infrastructure that is not 'fit-for-purpose' for current requirements. Provision of appropriate community infrastructure is a pressing issue for the City of Melbourne, both in areas with new residential communities (such as Southbank and Docklands) and established neighbourhoods where there are gaps or ageing infrastructure (such as Carlton or Kensington).

To provide a structured approach to addressing these issues, this project involves a review of the City of Melbourne Community Infrastructure Plan, and the establishment of a framework for the rollout of community facilities throughout the municipality. This includes planning for community infrastructure projects, specifically the rejuvenation of the Kensington Town Hall, and community centres in Carlton, Southbank and Docklands. Planning and development of other community infrastructure identified in the revised plan will also be included in this project plan.

ANNUAL PLAN MEASURE TYPE TARGET COMMENTS Review the Community Infrastructure Cost $50,000 $30,340 Plan The expenditure included assessment of community infrastructure and planning needs undertaken by consultants (cost: $23,920). Preparation of a community infrastructure framework by consultants (cost: $1,920), and development of concept and design art work for final plan by consultants (cost: $4,500). The level of expenditure required was less than anticipated. Document plans for Kensington Town Cost $300,000 $133,543 Hall The budgeted cost of $300,000 was based on an estimation of the costs to deliver the design and documentation for the upgrade of the Kensington Town Hall. The costs incurred to 30 June 2010 were $133,543 and considerably lower than budget due to only the design being completed this financial year. The balance of the project budget has been carried forward into 2010–11 to complete the project as this is a multi-year project. Seek external funding to rejuvenate Cost Up to $2M $0 Kensington Town Hall Applied for external funding but was unsuccessful.

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Concept and feasibility for the Cost $100,000 $389,307 redevelopment of the former Boyd High The budgeted cost of $100,000 was based on an estimation of the costs School site to commence the design and documentation for the redevelopment of the Boyd High School site. During the course of 2009–10 the City of Melbourne approved this project to proceed which necessitated additional work for the project to get off the ground and to commence works in 2010–11. The costs incurred to 30 June 2010 were $389,307 and considerably higher than budget. The over spend in 2009–10 will be offset in future budget allocations to this multi-year project in 2011–12. Determine the partnership Time June 2010 100% arrangements for funding of library and In 2009–10 there has been significant progress made developing and community hub in Docklands and delivering the community infrastructure framework. All specific project commence documentation milestones have been met or exceeded. The outcome has been: • the community infrastructure implementation framework has been completed and endorsed by council • tenders for structural works (primarily underpinning) on the Kensington Town Hall were advertised and closed. Tenders having been awarded and site works expected to begin mid July 2010 • the Drill Hall site construction works have begun for the provision of affordable accommodation and ancillary community office space and facilities • the Boyd School plans have been drafted to include a full neighbourhood library, family and children's services, artist studio spaces and a multi-purpose community space • the Multicultural Hub refurbishment has been completed with a return to full use and occupation anticipated by July 2010 • a working group has progressed the proposal by the Office of Housing for the development of a Health and Aged Services Hub at the base of 480 Lygon Street. Discussions regarding other community infrastructure opportunities (on sites surrounding the Carlton Housing redevelopment) are being considered. They include redevelopment of the Carlton Primary School site and redevelopment of the Carlton Baths/Carlton Family Resource Centre to include a multi- purpose recreation and family/children's services hub.

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KSA 10 – Develop a 10-year financial plan

The City of Melbourne recognises that the financial planning horizon for the organisation is longer than the current four year strategic resource plan and requires the establishment of long term 10 year financial plan to guide strategic decision making.

ANNUAL PLAN MEASURE TYPE TARGET COMMENTS Staffing (existing) Cost $30,000 $5,151 The budgeted cost was $30,000 based on an estimation of direct staff time required to fulfil the project and assumed a fulltime commitment by a staff member. The final costs were $5,151 and considerably lower than budget due to not requiring a fulltime resource on the project. The final cost was captured through the use of timesheets. Completion date Time June 2010 90% After finalising the shell document and a review of other comparable organisation’s 10 year financial plan the key inputs for the City of Melbourne 10 year financial plan have been confirmed. In May a draft copy of the 10 year plan was prepared however finalising the financial profile including ratios, is still subject to direction on the policy statements and rating strategies. Further information was required to explain rating strategy options. This was presented at the councillor forum on Tuesday 25 May 2010. All aspects of council operations Quantity Financial plan The 10 Year Plan is now awaiting Councillor direction particularly in relation covered in the 10 year financial components to the rating strategy before it can be finalised. plan include the All the councillor’s, Lord Mayor and Deputy Lord Mayor have been needs and interviewed regarding the financial plan components and the next steps are priorities for to consolidate results and report back to council. infrastructure development, maintenance and service delivery

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Quality A plan that Key financial drivers have been identified and form part of the underlying includes City financial model for the plan. of Melbourne Additional work to gather individual feedback from all councillors on the policy policy statements and strategies was undertaken in July 2010 in an effort to directions and achieve a consensus and finalise the plan. key financial strategies

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KSA11 – Develop and implement a community engagement framework and evaluation methodology

The community engagement framework will provide policy and operational guidance to the organisation in all facets of community engagement. In addition, the framework will provide practical tools, professional training and support, communication mechanisms (internal and external) and evaluation methods. The framework will build organisational capacity enabling collaboration and decision making at all levels of the organisation. It will support a consistent and high quality approach to engagement, through provision of resources, assistance and advice.

ANNUAL PLAN MEASURE TYPE TARGET COMMENTS Staffing (existing) Cost $311,000 $308,000 Project managed to budget. Minor variance. Community engagement Time June 100% framework developed 2010 The community engagement framework, consisting of a number of elements grouped in four categories – people, practice, policy and performance – is 100 per cent complete. The framework is intended to support sustainable decision making by councillors; staff provide well informed reports and recommendations that have been supported by a rigorous community engagement process. The framework was developed using a capacity building approach to change. This approach is inclusive by nature and models the ideology and methodology of good practice engagement. This has helped to build trust in the vision and leadership of the organisation and has encouraged staff to embrace a new culture engaging communities of interest on issues that impact on wellbeing. Over 200 members of staff have helped develop the framework providing valuable input into the guidelines, training program, policy, portal, measurement methodology, case studies and the practitioner network used. As a result of this collaboration the framework reflects the needs and aspirations of the organisation across a broad range of program and service areas. Staff have steadily acquired skills to develop and design community engagement processes. These processes seek stakeholder ideas, views and opinions on a wide range of issues and initiatives. The information obtained through this process helps to ensure the City of Melbourne delivers high quality programs and services that genuinely reflect the needs and aspirations of the community.

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The measurement methodology ensures that the framework can provide evidence of its value and success. Importantly, this also ensures that the organisation applies a rigorous process of continuous improvement so that it remains contemporary and relevant. The community engagement Quantity Up to 5 Assisted four of the scheduled five KSA projects with their community engagement plans. framework used in up to five of of the 11 The fifth KSA project (QVM long term strategy) has been delayed until the 2010–11 financial the eleven 2009–10 KSAs KSAs year.

Community satisfaction rating Quality 60% Indexed mean score of 62% from the Department of Planning and Community Development for council’s engagement in Community Satisfaction Survey results. decision making on key local issues

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MELBOURNE CITY COUNCIL

Statement by councillors, Chief Executive Officer and Principal Accounting Officer on the performance statement for the year ending 30 June 2010

In my opinion the accompanying performance statement has been prepared in accordance with the Local Government Act 1989.

Phu Nguyen (CPA)

Principal Accounting Officer

In the council’s opinion the accompanying compulsory performance statement presents fairly the performance of the Melbourne City Council for the year ending 30 June 2010.

As at the date of signing, we are not aware of any circumstance, which would render any particulars in the performance statement to be misleading or inaccurate.

We were authorised by the council on 31 August 2010 to certify the financial report in its final form.

Robert Doyle Brian Shanahan

Lord Mayor Councillor

Kathy Alexander

Chief Executive Officer

Melbourne

31 August 2010

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Best value

The City of Melbourne is dedicated to the continuous improvement of its services and projects to ensure best value for the community. In 2000, the Local Government Act 1989 (Vic) was amended to incorporate six ‘best value’ principles to ensure high quality and value-for-money services that respond to the community’s needs.

The best value principles are applied by the City of Melbourne in our day-to-day assessment of services and in late 2008 we furthered our commitment to value and quality by implementing the Lean Thinking approach to service improvement.

Lean Thinking is a business methodology that aims to create value for internal and external customers by eliminating waste and duplication. In service industries, ‘lean’ means the right service, in the right place, at the right time, provided by the right person and done right the first time.

There were 10 major programs of Lean Thinking work ‘streams’ for 2009–10. Each stream applied at least one of the following five performance measures:

• quality • cost • timeliness • customer or staff satisfaction • sustainability.

The City of Melbourne has continued to apply the best value principles in assessing and improving its services in the following ways:

Best value principle Application at City of Melbourne

Quality and cost standards This principle refers to the extent to which services are achieving or exceeding relevant key performance indicators of service quality and the service can demonstrate value for money. The City of Melbourne measures the standard of service through a range of quality and cost measures including industry standards, the strategic indicators of its council plan and measures for Lean Thinking streams. The following Lean Thinking streams have measures aligned to quality and cost: • Parking meters – improved repair process resulted in reduced service costs to the City of Melbourne • Construction zone permits – reduced time to issue a permit • Childcare centres – improved efficiency through systematic sorting and organization on of work areas. Responsive to community This principle refers to the extent to which the community feels needs that we not only understand what they are seeking from services offered but also the extent that the current service offerings reflect that understanding.

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Community needs are established through the analysis of customer requests, community feedback and survey results. During 2009–10, the City of Melbourne sought feedback on its performance from groups such as residents, businesses and international students. Survey results help the organisation set targets for continuous improvement in service delivery, and provide data to support best value principles in our planning, decision making and actions. The primary focus of Lean Thinking is to improve value from the perspective of the customer – in our case, the community – by eliminating waste in processes. Some examples include: • Childcare centres – improved communication to parents. Responding to the needs of the customer through introduction of online payment options to improve timeliness and ease of payments • Parking meters – 70 per cent reduction in calls from customers reporting faulty meters • Executive correspondence – streamlining of processes to improve customer response time. Accessible services This principle refers to the extent to which services are able to be readily accessed by those for whom the services are intended. Annual business plans are developed for each branch of the organisation and barriers to accessibility are addressed through these plans. In response to accessibility concerns, the City of Melbourne corporate website has undergone a major review over the past year. We have followed version 1.0 of the W3C Web Content Accessibility Guidelines to level AA and introduced cascading style sheets, the availability of text only version documents and larger text options for all pages. Continuous improvement This principle refers to the extent to which our work is continuously improved. The City of Melbourne has adopted a Lean Thinking approach as our improvement model. Some improvement outcomes for 2009–10 include: • Executive correspondence – improved timeliness to respond to correspondence within 10 working days from 51 per cent to 94 per cent. • Construction zone permits – reducing the total length of days to install from about 200 to approximately 28. • Travel coordination – reducing the process steps by 46 per cent resulting in 69 per cent of travel episodes being completed within the target time. • Childcare centres – improved functionality of the waiting list to reduce time staff spend manually entering data by 45 per cent and updating the list by 66 per cent. Improved website and communications reducing customer enquiries by approximately 50 per cent.

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• Recruitment – improved IT access for new employees (12 per cent to 85 per cent) by reducing the process steps for recruitment requests. Community consultation Community engagement is any process that involves the public in problem-solving or decision making and uses public input to make decisions. The City of Melbourne community engagement framework is built on the IAP2 core values and spectrum for public participation. This year the City of Melbourne has sought feedback on a number of projects including: • the Swanston Street redevelopment • the Children’s Plan for Children • the Chinatown precinct lighting project. Report regularly to the The City of Melbourne reports regularly to the community community through advisory reference group meetings, publications such as Melbourne News, our corporate website, newsletters and fact sheets and the annual report.

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Victorian Local Government Indicators

The Minister for Local Government, under the authority of the Local Government Act 1989, requires every council to present a report on the following indicators:

Indicator 2009–10 2008–09 2007–08 2006–07 2005–06 Overall performance Community satisfaction rating for overall 68 66 68 72 70 performance generally of council Advocacy Community satisfaction rating for the 64 61 62 66 65 council's advocacy and community representation on key local issues

Engagement Community satisfaction rating for the 62 59 59 61 61 council's engagement in decision-making on key local issues All rates Average rates and charges per $2,457 $2,318 $2,265 $2,255 $2,481 assessment (all rates) Residential rates Average rates and charges per residential $968 $939 $877 $809 $866 assessment Operating costs Average operating expenditure per $4,214 $4,333 $3,993 $4,455 $4,799 assessment Capital expenditure Average capital expenditure per $863 $1,060 $909 $932 $1,838 assessment Infrastructure Renewal gap 76% 70% 67% 76% 173% Renewal and maintenance gap 79% 72% 71% 80% 161% Debts Average liabilities per assessment $817 $989 $1,184 $1,331 $1,039 Operating result

1 Operating results per assessment $(360) $340 $1,357 $2,819 $288 Note: This represents the operating results per assessment as per the subtotal profit/loss for the period.

1 This result largely reflects the City of Melbourne no longer being the Committee of Management for Yarra Park

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ABOUT THE GLOBAL REPORTING INITIATIVE

The Global Reporting Initiative (GRI) is the world’s most widely used sustainability reporting framework. Its principles and indicators provide a mechanism for measuring and reporting economic, environmental and social performance.

The GRI’s indicators promote transparency, accountability and accuracy, making it easier to compare performance in an increasingly globalised operating environment.

Currently, around four per cent of organisations globally use sustainability reporting. In Australia this figure is 35 per cent2.

The Global Reporting Initiative’s principles of inclusiveness, relevance, sustainability context and completeness define the content of this report. Stakeholder feedback on the 2008–09 Annual Report has also been taken into account. A cross organisational working group was formed to develop this annual report and senior management were regularly consulted throughout the development process. Councillors will consider the City of Melbourne Annual Report 2009–10 at the October 2010 meeting.

Reading this index

The City of Melbourne has included GRI sustainability indicators as part of its performance measures since 2004–05.

The GRI appears in this annual report as a list of indicators, each with a page reference to demonstrate compliance.

GRI application level

This report was prepared to meet the requirements of application level B under the GRI’s Sustainability Reporting Guidelines, maintaining the standard of reporting and disclosure of previous years.

Rather than seek external assurance for GRI, the City of Melbourne focuses its resources on strengthening internal reporting processes and maintaining an already thorough level of auditing.

More information about the GRI is available at www.globalreporting.org

2 Professor Richard Petty, President CPA Australia. Presentation to Australasian Reporting Awards seminar, Melbourne, 5 June 2009

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GRI content table

GRI standard disclosure Page GRI indicator Report profile – strategy and analysis Message from CEO and LM Message from CEO (page 8) and Lord 1.1 Mayor (page 7) Risks and opportunities Message from CEO (page 8) and Lord 1.2 Mayor (page 7) Support for the United Nations Purpose of this report (page 3) 1.3 Global Compact Report profile – organisational profile Council profile, products and Melbourne City Council (page 18), our 2.1 – 2.10 services and organisational profile performance (page 43), organisational profile (page 35), about this report (page 3) Report parameters Report profile Purpose of this report (page 3) 3.1 – 3.5 Report scope and boundaries Purpose of this report (page 3) 3.6 – 3.11 GRI context index GRI content table (page 104) 3.12 Assurance Purpose of this report (page 3) 3.13 Governance, commitment and engagement Governance and risk management Purpose of this report (page 3), Melbourne 4.1 – 1.12 City Council (page 18), our performance (page 43), organisational profile (page 35) Memberships Council profile (page 19) 4.13 Stakeholder engagement Community engagement / Lean Thinking 4.14 – 4.17 feature (page 9), About the GRI (page 103) Public policies and implementation measures Sustainable development policies Our performance (page 43) PA2 – PA3 Goals, measures and targets Our performance / performance measures PA4 – PA7 (page 43) Economic indicators – performance Economic value generated and Our financials (page 106) EC1 distributed Risks and opportunities due to Our performance (page 43) EC2 climate change Significant financial assistance from Our financials (106) EC4 government

104 City of Melbourne Annual Report 2009–10

Economic indicators – indirect economic impacts Gross expenditure by type of Our financials (page 106) PA8 – PA9 payment and classification Economic indicators – expenditure and procurement Procurement policy Our performance – eco-city (page 59) PA11 Economic, environmental and Our performance – eco-city (page 59) PA12 social criteria Procurement practice and policy Our performance – managing our resources PA13 priorities (page 70) Environmental indicators Energy consumption Our performance (page 43) EN3 – EN7 Water consumption Our performance (page 43) EN9, EN10 Biodiversity Our performance – eco-city (page 59) EN14 Greenhouse gas emissions Our performance – eco-city (page 59) EN16, EN18 Labour practices and decent work indicators Employment, labour/management Organisational profile (page 35) LA1, LA2, practices LA4 Occupational health and safety, Organisational profile (page 35) LA6 – LA14 training and education, diversity and equal opportunity Social performance indicators Community Our performance (page 43) SO1 Corruption Corporate governance (page 24) SO2 – SO4 Public policy Melbourne City Council (page 18) SO5 Compliance Corporate governance (page 24) SO8 Product responsibility indicators Marketing and communications Corporate governance (page 24) PR6 – PR8

105 City of Melbourne Annual Report 2009–10

PART THREE Financial statements

106 City of Melbourne Annual Report 2009–10

OUR FINANCIALS

Prepared in accordance with the Local Government Act 1989, Local Government (Finance and Reporting) Regulations 2004, and applicable Australian Accounting Standards. Table of contents

FINANCIAL REPORT Comprehensive income statement ...... 108 Balance sheet ...... 109 Statement of cash flows...... 110 Statement of changes in equity (consolidated) ...... 111 Statement of changes in equity (council) ...... 112 NOTES TO THE FINANCIAL STATEMENTS Note 1. Significant accounting policies ...... 114 Note 2. Operating result attributable to functions/activities (consolidated) ...... 122 REVENUE FROM ORDINARY ACTIVITIES Note 3. Revenues from ordinary activities ...... 124 EXPENSES FROM ORDINARY ACTIVITIES Note 4. Expenses from ordinary activities...... 127 ASSETS Note 5. Trade and other receivables...... 128 Note 6. Inventories...... 129 Note 7. Other financial assets – non current...... 129 Note 8. Other assets ...... 129 Note 9. Property, plant, equipment and infrastructure ...... 130 Note 10. Intangible assets ...... 134 Note 11. Investment property...... 135 LIABILITIES Note 12. Trade and other payables ...... 136 Note 13. Employee benefits...... 137 Note 14. Provisions...... 138 EQUITY Note 15. Reserves ...... 138 OTHER DISCLOSURES Note 16. Gains/ (loss) on sale of fixed and intangible assets ...... 140 Note 17. Cash flow information...... 141 Note 18. Leases and Commitments...... 142 Note 19. Contingent assets and liabilities ...... 143 Note 20. Superannuation ...... 144 Note 21. Related party transactions...... 147 Note 22. Financial instruments ...... 149 Note 23. Financial ratios ...... 159 Note 24. Events occurring after balance date...... 160 Statement by Councillors, Chief Executive and Principal Accounting Officer on the Financial Report...... 161 Auditor-General’s report on the financial report ...... 162

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FINANCIAL REPORT

MELBOURNE CITY COUNCIL Comprehensive income statement

For the year ended 30 June 2010

Consolidated Council 2010 2009 2010 2009 $'000 $'000 Note $'000 $'000 Revenues from ordinary operations Rates 180,670 170,541 1(d),3(a) 180,670 170,541

Grants and other contributions 28,629 22,687 1(d),3(d) 28,462 22,494 Parking Fees 41,231 35,546 3(b) 38,002 32,486 Fines 42,588 43,326 1(d) 42,588 43,326 Property revenue 22,830 22,092 6,730 6,735 Other Fees & Charges 113,551 114,279 17,622 16,776 Intercompany Revenue - - 13,428 16,056 Finance Income 7,795 8,795 3(c) 7,008 9,095 Sales & Recoveries 15,438 17,673 6,499 7,515 272,062 264,398 160,339 154,483

Total Revenue 452,732 434,939 341,009 325,024

Expenses from ordinary operations Employee benefit expense 153,890 141,557 4(a) 95,276 87,118 Contract Payments, Materials and Services 172,842 171,442 4(b) 136,055 131,483 Depreciation and amortisation 56,608 53,316 4(c) 46,625 43,885 Finance costs 13,579 12,321 4(d) 11,792 11,259 Other Expenses 20,802 19,794 4(e) 20,207 19,282 Total Expenses 417,721 398,430 309,955 293,027

Net gain/(loss) on disposal of property, plant & infrastructure (153) (2,647) 16 (321) (2,349) Contributed Assets 17,255 18,821 19(b) 17,255 18,821 Transfer assets to external parties (74,496) (23,475) (74,496) (23,475) Profit/(loss) (22,383) 29,208 (26,508) 24,994

Other Comprehensive Income Fair value adjustments for financial assets at fair value 388 (104) 389 (104) Net asset revaluation increment(decrement) 178,889 (6,554) 15 176,152 1,568 Gain/(loss) on defined benefits plans (904) (14,136) - - Comprehensive Result 155,990 8,414 150,033 26,458

The comprehensive income statement should be read with the accompanying notes to the financial report.

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City of Melbourne Annual Report 2009–10

MELBOURNE CITY COUNCIL Balance sheet

As at 30 June 2010

Consolidated Council 2010 2009 2010 2009 $'000 $'000 Note $'000 $'000 ASSETS Current Assets Cash and cash equivalents 115,105 111,470 17(b) 102,901 99,037 Trade and other Receivables 38,259 37,366 5 21,464 23,858 Accrued Income 3,872 3,106 2,761 1,926 Inventories 478 382 6 -- Other Financial Assets 14,664 14,275 7,17(b) 14,664 14,275 Other 893 826 8 4,646 4,633 Total Current Assets 173,271 167,425 146,436 143,729

Non-Current Assets Financial Assets 3,042 3,042 7 32,921 32,818 Intangible assets 14,256 13,498 10 4,405 3,647 Property, Plant and Infrastructure 2,791,768 2,659,254 9 2,725,319 2,598,941 Investment Property 96,896 89,446 11 96,896 89,446 Total Non-Current Assets 2,905,962 2,765,240 2,859,541 2,724,852

TOTAL ASSETS 3,079,233 2,932,665 3,005,977 2,868,581

LIABILITIES Current Liabilities Trade and Other Payables 47,029 53,940 12 29,141 43,671 Employee benefits 27,780 25,480 13(a) 19,434 18,115 Provisions 1,510 622 14 1,316 467 Total Current Liabilities 76,319 80,042 49,891 62,253

Non-Current Liabilities Interest Bearing Liability 1,000 7,500 - - Employee benefits 5,735 5,208 13(b) 3,908 3,656 Trade and other Payables 6,322 6,850 12(a) 6,322 6,850 Net Liability of City of Melbourne's Defined Benefits Superannuation Fund 11,157 10,355 - - Total Non-Current Liabilities 24,214 29,913 10,230 10,506

TOTAL LIABILITIES 100,533 109,955 60,121 72,759

NET ASSETS 2,978,700 2,822,710 2,945,856 2,795,822

Equity Accumulated Surplus 1,720,780 1,744,467 1,699,096 1,726,002 Reserves 1,257,920 1,078,243 15 1,246,760 1,069,820 TOTAL EQUITY 2,978,700 2,822,710 2,945,856 2,795,822

The balance sheet should be read with the accompanying notes to the financial report.

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City of Melbourne Annual Report 2009–10

MELBOURNE CITY COUNCIL Statement of cash flows

For the year ended 30 June 2010

Consolidated Council 2010 2009 2010 2009 $'000 $'000 Note $'000 $'000

Cash Flows from Operating Activities

Receipts Rates, Fees and Charges (inclusive of GST) 415,282 393,511 298,654 281,802 Grants and Other Contributions (inclusive of GST) 30,518 23,961 30,334 23,768 Interest 7,668 8,758 6,881 7,887 Dividends Received 127 38 4,665 8,240 Tax equivalents - - 3,129 3,282 Other (including Sales & Recoveries) (inclusive of GST) 20,039 28,072 18,029 23,516 Payments Employee benefit expense (149,900) (128,745) (93,384) (85,670) Materials and Services (inclusive of GST) (227,032) (218,414) (194,158) (189,096) Other (inclusive of GST) (4,281) (4,381) (3,686) (3,571) Net Cash provided by Operating Activities 92,421 102,800 17(a) 70,465 70,158

Cash Flows from Investing Activities

Proceeds from sale of property, infrastructure, plant and equipment 932 1,420 932 1,420 Payments for property, infrastructure, plant and equipment (77,374) (97,167) (63,483) (77,973) Investment in Sustainable Melbourne Fund - - (102) (1,170) Joint Venture Payments (570) - (570) (580) Loans to subsidiaries - - - 111 Net Cash used by Investing Activities (77,012) (95,747) (63,223) (78,192)

Cash Flows from Financing Activities

Proceeds from borrowings (6,500) (3,100) -- Finance costs (inclusive of GST) (4,885) (12,794) (2,989) (2,026) Net Cash used by Financing Activities (11,385) (15,894) (2,989) (2,026)

Net Increase/(decrease) in cash and cash equivalents 4,024 (8,841) 4,253 (10,060)

Cash and cash equivalents at beginning of the financial year 125,745 134,586 113,312 123,372

Cash and cash equivalents at end of the financial year 129,769 125,745 17(b) 117,565 113,312

The statement of cash flows should be read in conjunction with the accompanying notes to the financial report.

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City of Melbourne Annual Report 2009–10

MELBOURNE CITY COUNCIL Statement of changes in equity (consolidated)

For the year ended 30 June 2010

Total Equity Accumulated Surplus Asset Revaluation Other Reserves Reserve 2010 2009 2010 2009 2010 2009 2010 2009 Note $'000 $'000 $'000 $'000 $'000 $'000 $'000 $'000

Balance at beginning of the financial year 2,822,710 2,814,296 1,744,467 1,729,144 1,076,829 1,083,383 1,414 1,769

Surplus/(deficit) for the year (22,383) 29,208 (22,383) 29,208 - - -- Actuarial expense - City of Melbourne's Defined Benefits Superannuation Fund (904) (14,136) (904) (14,136) - - -- Asset Revaluation 15 178,889 (6,554) - - 178,889 (6,554) - - Reserve for Public Open Space 15 - - (400) 251 - - 400 (251) Investments Revaluation Reserve 15 389 (104) - - - - 389 (104) Balance at end of the financial year 2,978,700 2,822,710 1,720,780 1,744,467 1,255,718 1,076,829 2,203 1,414

The statement of changes in equity (consolidated) should be read in conjunction with the accompanying notes to the financial report.

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City of Melbourne Annual Report 2009–10

MELBOURNE CITY COUNCIL Statement of changes in equity (council)

For the year ended 30 June 2010

Total Equity Accumulated Surplus Asset Revaluation Other Reserves Reserve

2010 2009 2010 2009 2010 2009 2010 2009 Note $'000 $'000 $'000 $'000 $'000 $'000 $'000 $'000

Balance at beginning of the financial year 2,795,822 2,769,366 1,726,003 1,700,758 1,068,406 1,066,839 1,414 1,769

Surplus/(deficit) for the year (26,508) 24,994 (26,508) 24,994 - - -- Asset Revaluation 15 176,152 1,568 - - 176,152 1,567 - - Reserve for Public Open Space 15 - - (400) 251 - - 400 (251) Investments Revaluation Reserve 15 389 (104) - - - - 389 (104) Balance at end of the financial year 2,945,856 2,795,822 1,699,095 1,726,003 1,244,558 1,068,406 2,203 1,414

The statement of changes in equity (council) should be read in conjunction with the accompanying notes to the financial report.

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MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010

NOTES TO THE FINANCIAL STATEMENTS

The Melbourne City Council is a body corporate constituted pursuant to the Local Government Act 1989 to provide for the peace, order and good government of its municipal district. The Financial Report has been drawn up in accordance with that Act and related Regulations.

The purpose of the council is to:

• provide for the peace, order and good governance of its municipal district • to promote the social, economic and environmental viability and sustainability of the municipal district • to ensure that resources are used efficiently and effectively.

Principles to best meet the needs of the local community:

• to improve the overall quality of life of people in the local community • to promote appropriate business and employment opportunities • to ensure that services and facilities provided by the council are accessible and equitable • to ensure the equitable imposition of rates and charges • to ensure transparency and accountability in council decision making.

External Auditor - Victorian Auditor-General's Office

Internal Auditor - Deloitte Touche Tohmatsu

Solicitors - Hunt & Hunt, Mallesons Stephen Jaques, Blake Dawson, Maddocks

Banker - Westpac

Website address - www.melbourne.vic.gov.au

This financial report is a general purpose financial report that consists of a comprehensive income statement, balance sheet, statement of cash flows, statement of changes in equity, and notes accompanying these financial statements. The general purpose financial report complies with Australian Accounting Standards, other authoritative pronouncements of the Australian Accounting Standards Board, Australian Accounting Interpretations, the Local Government Act 1989, and the Local Government (Finance and Reporting) Regulations 2004.

International financial reporting standards

Australian Accounting Standards include Australian equivalents to International Financial Reporting Standards (IFRS). This Financial Report complies with the Australian equivalents to IFRS (A-IFRS).

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MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010 Note 1. Significant accounting policies

The significant policies, which have been adopted in the preparation of this Financial Report, are:

(a) Basis of preparation

The Financial Report has been prepared on the going concern basis and historical cost basis, except where otherwise stated, and accrual accounting principles. Unless otherwise stated, the accounting policies adopted are consistent with those of the previous year. Where appropriate, comparative figures have been amended to accord with current presentation and disclosure made of material changes to comparatives.

(b) Principles of consolidation

The consolidated results in the financial report include all funds through which the Melbourne City Council controls resources to carry on its functions. In the process of reporting on the Melbourne City Council as a consolidated unit, all intra and inter entity balances and transactions have been eliminated.

CityWide Service Solutions Pty Ltd, Queen Victoria Market Pty Ltd and Melbourne Wholesale Fish Market Pty Ltd are all wholly owned subsidiaries of the council incorporated in Australia and are included in the consolidated financial report.

The Sustainable Melbourne Fund Trust is a wholly controlled trust of the council and is included in the consolidated financial report.

Melbourne City Council is exempt from the payment of income tax and capital gains tax. Payments for Fringe Benefits Tax and Goods and Services Tax (GST) are made in accordance with the relevant legislation. Payments for payroll tax are only made by the trading entities controlled by the Melbourne City Council. The wholly owned subsidiaries are subject to the Melbourne City Council’s tax equivalent policy. Where the subsidiary is exempt from certain taxes it pays an equivalent of the tax to Melbourne City Council. Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred is not recoverable from the Australian Taxation Office. In these circumstances the GST is recognised as part of the cost of acquisition of the asset or as part of an item of the expense. Cash flows are presented in the cash flow statement on a gross basis, except for the GST component of investing and financing activities, which are disclosed as operating cash flows.

(d) Fees, fines, charges, rates, grants, and other contributions

Fees and charges are recognised as revenue when services are provided or the cash is received, which ever occurs first.

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MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010 Fines are recognised as revenue when the penalty is imposed. Rates, grants, and other contributions are recognised as revenues when Melbourne City Council obtains control over the related assets. Control over assets acquired from rates is obtained at the commencement of the rating period or, where earlier, upon receipt of the rates. Control over granted assets is normally obtained upon their receipt or upon prior written notification that a grant has been secured.

Where contributions recognised as revenues during the financial year were obtained on the condition that they be expended in a particular manner or used over a particular year, and those conditions were undischarged as at the reporting date, the nature of any amounts pertaining to those undischarged conditions are disclosed in Note 3(e). That note also discloses the amount of contributions recognised as revenues in previous financial years, which were expended in respect of Melbourne City Council’s operations during the current financial year.

Tax equivalents and dividends from subsidiaries are recognised as income when received or amounts have been declared at the respective subsidiary companies board meeting.

Revenue arising from service contracts is recognised by reference to the stage of completion of the contract, unless the outcome of the contract cannot be reliably estimated. The stage of completion is determined by reference to the proportion that costs incurred to date bear to the estimated total costs of the contract. Administrative overheads are not included in the costs of the contract for this purpose. Where the outcome of a contract cannot be reliably estimated, contract costs are recognised as an expense as incurred, and where it is probable that the costs will be recovered, revenue is recognised to the extent of costs incurred.

(e) Intangibles

(i) Goodwill

Where an entity or operation is acquired, the identifiable net assets acquired are measured at fair value. Fair value is defined in note 1(k)(ii). The excess of the fair value of the cost of acquisition over the fair value of the identifiable net assets acquired is brought to account as goodwill. Goodwill is not amortised, but tested for impairment annually. (ii) Software

Software, that is not an integral part of the related hardware, is classified as intangibles, recorded at cost and amortised on a straight line basis over a five year period. Goodwill Software

Useful lives Indefinite Finite Method used Not depreciated or revalued 5 Years – straight line

Internally generated/ Acquired Acquired acquired Impairment test/ Reviewed annually for Amortised method reviewed at each recoverable amount test indication of impairment financial year-end; Reviewed annually for indication of impairment

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MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010

(f) Employee benefits

Wages, Salaries, Annual and Long Service Leave

Liabilities for employees’ entitlements to wages and salaries, annual leave, and other employee benefits which are expected to be paid or settled within 12 months of the balance date are accrued at nominal amounts calculated on the basis of 2009–10 wage and salary rates and payroll based on costs in accordance with AASB 119 ‘Employee Benefits’.

Liabilities for other Employee benefits which are not expected to be paid or settled within 12 months of the balance date are accrued as per AASB 119 at the present values of future amounts expected to be paid based on 4 per cent per annum projected weighted average increase in wage and salary rates and payroll based on costs over an average period of five years. Present values are calculated using the government guaranteed securities rates with similar maturity terms. Superannuation

Council has an ongoing obligation to share in the future experience of the Melbourne City Council Superannuation defined benefits sub-plan. Favourable or unfavourable variations may arise should the experience of the Funds differ from the assumptions made by the Funds’ actuary in estimating the Funds’ accrued benefit liability.

An asset or liability is recognised in the consolidated financial statements as the council’s share of the scheme’s assets or liabilities, being the difference between the present value of employees’ accrued benefits and the net market value of the scheme’s assets at balance date. The asset also includes applicable contributions tax of 15 per cent.

Superannuation expense for the reporting year is the amount of statutory contribution Melbourne City Council makes to superannuation funds, which provides benefits to employees.

Details of these arrangements are set out in Note 20.

(g) Depreciation

Depreciation measures the service potential of buildings, infrastructure assets, plant and equipment consumed during the year. Interest in trees, land and artworks are not depreciated as they are considered to have either unlimited useful lives or to be self generating assets. Depreciation is recognised on a straight-line basis over the useful lives of the assets to the economic entity. Depreciation rates are reviewed each financial year. The depreciation periods for the major classes of assets are shown below represent the maximum useful life.

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MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010

2009–10 2008–09

Buildings 50 Years 50 Years

Roads & laneways - Seal 20 Years 20 Years

Roads & laneways - Substructure 90 Years 90 Years

Heritage Assets 100 Years 100 Years

Promenades and Wharves 100 Years 100 Years

Footpaths 50 Years 50 Years

Kerb & channel 50 Years 50 Years

Bridges 94 Years 94 Years

Drains 185 Years 185 Years

Plant & equipment 20 Years 20 Years

Furniture & fittings 10 Years 10 Years

Irrigation systems 20 Years 20 Years

Parks & gardens infrastructure 50 Years 50 Years

Statues, sculptures & artworks 100 Years 100 Years

Other structures 50 Years 50 Years

Assets are depreciated from the date of acquisition or, in respect of internally constructed assets, from the time an asset is completed and held ready for use.

(h) Cash assets

For purposes of the balance sheet, cash and cash equivalents includes short term deposits, bank bills, negotiable certificates of deposit and fixed interest securities which are readily convertible to cash on hand and are subject to an insignificant risk of changes in value, net of bank overdrafts. Short-term deposits are stated at cost. Fixed interest securities are valued at net fair value. Interest is recognised when earned.

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MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010 (i) Receivables and payables

Trade receivables are carried at nominal amounts due less any provision for doubtful debts. A provision for doubtful debts is recognised when collection of the full nominal amount is no longer probable. Receivables are generally settled within 30 days.

Trade creditors and accruals are recognised for amounts to be paid in the future for goods and services received, whether or not billed to the economic entity. The amounts are unsecured and are usually paid within 30 days of recognition.

(j) Provision for doubtful debts

The collectability of debts is assessed at balance date and specific provision is made for any doubtful accounts.

No provision is made for rate debtors because the debts are collectable against the property.

(k) Property, plant, equipment and infrastructure

(i) Capital and recurrent expenditure

As a general rule, material expenditure incurred in the purchase or development of assets is capital expenditure. Expenditure necessarily incurred in either maintaining the operational capacity of the non-current asset or ensuring that the original life estimate of the asset is achieved, is considered maintenance expenditure and is treated as an expense as incurred. Items of a capital nature with a total value of less than $2000 are treated as an expense. (ii) Acquisition

Acquisitions of assets are initially recorded at cost. Cost is determined as the fair value of the assets given as consideration plus costs incidental to their acquisition, including architectural and engineering fees and all other establishment costs.

The council’s policy is to capitalise and depreciate individual capital expenditure over $2000.

Fair value means the amount for which an asset could be exchanged between a knowledgeable willing buyer and a knowledgeable willing seller in an arm’s length transaction. (iii) Construction work in progress

The cost of property, plant, equipment and infrastructure constructed by Melbourne City Council includes the cost of materials and direct labour and an appropriate proportion of overheads. (iv) Leases

Melbourne City Council does not currently use any finance lease arrangements. In respect of operating leases, where the lessor effectively retains substantially the entire risks and benefits incidental to ownership of the leased property, the payments are charged to expense over the lease term.

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MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010

(v) Asset revaluation

All asset values not valued at Cost were reviewed and where necessary valued as at 30 June 2010. The net increase in the Asset Revaluation Reserve was $176.152 million for the council and an increase of $178.889 million for the economic entity in 2009–10 (refer to note 15).

Revaluation increments are credited directly to the asset revaluation reserve, except that, to the extent that an increment reverses a revaluation decrement in respect of that class of asset previously recognised as an expense, the increment is recognised as revenue. (vi) Heritage assets

The maximum life for depreciation of Heritage assets is 100 years.

Revaluation decrements are recognised immediately as expenses, except that, to the extent that an increment balance exists in the asset revaluation reserve in respect of the same class of assets, they are debited directly to the asset revaluation reserve. Revaluation increments and decrements are offset against one another within a class of non-current assets, but not otherwise. (vii)Valuation

All land and buildings are valued at fair value, being market value assuming the highest and best use permitted by the relevant land use planning provisions or existing public use whichever is the greater. Freehold land reserved for public open space is valued at a discount, being 20 per cent of market value, based on legal precedents.

All improvements on Crown land are valued on the basis of fair value, being either market value or written down replacement cost for special purpose buildings.

Infrastructure assets are valued at fair value, being replacement cost less accumulated depreciation. (viii)Impairment

At each reporting date, the council reviews the carrying value of its assets to determine whether there is any indication that these assets have been impaired. If such an indication exists, the recoverable amount of the asset, being the higher of the asset’s fair value less costs to sell and value in use, is compared to the assets carrying value. Any shortfall of the assets carrying value over its recoverable amount is expensed to the comprehensive income statement.

(l) Non-cash donations

Non-cash donations in excess of $2000 value are recognised as revenue and as non-current assets at their fair value at date of receipt. Non-cash donations of less than $2000 are not recognised where these are immaterial in total.

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MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010 (m) Rounding

Unless otherwise stated, amounts in the Financial Report are rounded to the nearest thousand dollars.

(n) Web site costs

Costs in relation to web sites controlled by the Melbourne City Council are charged as expenses in the period in which they are incurred unless they relate to the acquisition of an asset, in which case they are capitalised and amortised over their period of expected benefit.

(o) Allocation between current and non-current

With the exception of employee entitlements, the determination of whether an asset or liability is current or non-current, consideration is given to the time when each asset or liability is expected to be realised or paid. The asset or liability is classified as current if it is expected to be turned over within the next twelve months, being the council’s operational cycle.

For employee entitlements, long service leave entitlements for employees with over 10 years service and all annual leave entitlements are classified as current. Long service leave entitlements for employees with less than 10 years service is classified as non-current.

(p) Investment property

Investment property is held to generate long-term rental yields. All tenant leases are entered into at an arms length basis.

Investment property is carried at fair value, being market value assuming the highest and best use permitted by the relevant land use planning provisions or existing public use whichever is the greater. Valuation of investment properties at 30 June 2010 were determined by David Slicer Senior Valuer, Valuations Branch. Any changes to fair value are recorded in the comprehensive income statement. Investment properties are not depreciated.

(q) Pending Accounting Standards

The following Australian Accounting Standards have been issued or amended and are applicable to the council but are not yet effective. They have not been adopted in preparation of the financial statements at reporting date.

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MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010

Standard / Interpretation Summary Applicable for annual Impact on Local Government reporting periods beginning financial statements or ending on

AASB 2009-5 Further Amendments to Some amendments will result in accounting changes for Beginning 1 Jan 2010 Terminology and editorial changes. Australian Accounting Standards arising presentation, recognition or measurement purposes, Impact - Now called Comprehensive from the Annual Improvements Project. while other amendments will relate to terminology and Income Statement which has now [AASB 5, 8, 101, 107, 117, 118, 136 & editorial changes. been reflected in this report. 139]

AASB 9 Financial Instruments This standard simplifies requirements for the Beginning 1 Jan 2013 Detail of impact is still being classification and measurement of financial assets assessed. resulting from Phase 1 of the IASB’s project to replace IAS 39 Financial Instruments: Recognition and Measurement (AASB 139 Financial Instruments: Recognition and Measurement ).

AASB 2009-11 Amendments to This gives effect to consequential changes arising from Beginning 1 Jan 2013 Detail of impact is still being Australian Accounting Standards arising the issuance of AASB 9. assessed. from AASB 9 "Financial Instruments" [AASB 1, 3, 4, 5, 7, 101, 102, 108, 112, 118, 121, 127, 128, 131, 132, 136, 139, 1023 & 1038 and Interpretations 10 & 12]

AASB 2009-14 Amendments to Amendment to Interpretation 14 arising from the Beginning 1 Jan 2011 Expected to have no significant Australian Interpretation – Prepayments issuance of Prepayments of a Minimum Funding impact of a Minimum Funding Requirement Requirement [AASB Interpretation 14]

AASB 2010-2 amendment of AASB 124 Changes to some disclosure requirements reporting on Beginning 1 Jul 2013 Detail of impact is still being assesed. Related Party Disclosure related parties for entities who qualify for reduced disclosure requirements.

(r) Critical accounting judgements and key sources of estimation uncertainty

In application of the council’s accounting policies, council is required to make judgements, estimates and assumptions about carrying values of certain assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period of the revision and future periods if the revision affects both current and future periods.

(s) Functional currency

The presentation currency of Melbourne City Council is the Australian dollar. The functional currency of each subsidiary throughout the council and the consolidated financial statements is also the Australian dollar.

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MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010 Note 2. Operating result attributable to functions/activities (consolidated)

(a) Revenues, expenses have been attributed to the following functions

Functions/Activities Net Surplus REVENUES EXPENSES /(Deficit) for the year

$'000 $'000 $'000

A Connected and Accessible City 2009 88,454 (105,891) (17,437) 2010 95,569 (110,729) (15,160)

Innovative and Vital Business City 2009 2,080 (6,219) (4,139) 2010 2,039 (5,360) (3,321)

Inclusive and Engaging City 2009 32,957 (94,451) (61,494) 2010 39,968 (100,897) (60,930)

Environmentally Responsible City 2009 709 (20,713) (20,004) 2010 609 (20,940) (20,331)

Well-managed and Leading Corporation 2009 12,641 (60,202) (47,561) 2010 12,588 (59,798) (47,210)

Financially Responsible Corporation 2009 208,422 (32,794) 175,628 2010 208,425 (87,980) 120,448

Subsidiaries 2009 109,915 (105,700) 4,215 2010 111,717 (107,597) 4,120

TOTAL 2009 455,178 (425,970) 29,208 2010 470,915 (493,302) (22,384)

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MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010

(b) A brief description of the goal of each function is as follows:

• A connected and accessible city – to ensure the city has accessible infrastructure and is connected to its immediate surrounds, the nation and the world. • An innovative and vital business city – to ensure business development, job growth and gateway infrastructure is strengthened by intelligence, creativity and a progressive outlook. • An inclusive and engaging city – to ensure a creative city with a strong cultural spirit, an inviting, inclusive and stimulating place for all who live, work and visit it. • An environmentally responsible city – to ensure sustainable decision-making and environmental leadership increases and improves its natural assets. • A well-managed and leading corporation – to ensure a well-managed and leading corporation recognised for its high-calibre staff, processes, products and interactions with stakeholders, the delivery of effective and accountable governance and business processes. • A financially responsible corporation – to ensure long-term sustainability through strategic planning and well-managed finances and assets.

Subsidiaries include the following entities:

• CityWide Service Solutions Pty Ltd To meet the contract service needs of local government, other governments, and private and public sector corporations by providing a comprehensive range of quality, physical services at competitive rates.

• Queen Victoria Market Pty Ltd To ensure that the market maintains and enhances an industry reputation as Australia’s foremost traditional market, whilst meeting world’s best practice standards.

• Melbourne Wholesale Fish Market Pty Ltd To ensure that the Market is operated as a fully commercial business serving the needs of the fishing industry and community.

It should be noted that Melbourne Wholesale Fish Market will cease operation on 31 Dec 2010. Refer to Note 19a for further details.

• Sustainable Melbourne Fund Trust The Sustainable Melbourne Fund (SMF) is a self sustaining fund set up by Melbourne City Council which invests funds in projects with environmental benefits to the city. The projects may extend beyond the boundaries of Melbourne City Council to the broader state of Victoria, reflecting the position of Melbourne as the capital city of Victoria.

These entities support Melbourne City Council in providing services to the community.

123

MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010 Note 3. Revenues from ordinary activities

(a) Rates

Consolidated Council 2010 2009 2010 2009 $'000 $'000 $'000 $'000 General Rates Residential 52,216 50,359 52,216 50,359 Commercial and Retail 125,209 116,558 125,209 116,558 Cultural & Recreational Land Rates 357 341 357 341 Supplementary Rates 3,814 3,554 3,814 3,554 Objections/Exemptions (926) (271) (926) (271) 180,670 170,541 180,670 170,541

Melbourne City Council uses ‘net annual value’ as the basis of valuation of all properties within the municipal district. The net annual value of a property approximates the annual net rental for a commercial property and five per cent of the capital improved value for a residential property.

The date of the general valuation of land for rating purposes within the municipal district was 1 January 2010 and the valuation first applied to the rating period commencing 1 July 2010.

(b) Parking fees

Consolidated Council 2010 2009 2010 2009 $'000 $'000 $'000 $'000 On street parking 30,186 24,602 30,175 24,588 Off street parking 7,955 7,266 4,737 4,220 Sporting/entertainment venues 1,605 2,159 1,605 2,159 Tow away fees 1,485 1,519 1,485 1,519 41,231 35,546 38,002 32,486

Consolidated Council 2010 2009 2010 2009 $'000 $'000 $'000 $'000 Interest received from Investments 6,906 7,906 6,301 7,240 Interest Due from Overdue Rates 539 583 539 583 Interest received from loan to CityWide Service Solutions -- 18 Other 350 306 167 1,264 7,795 8,795 7,008 9,095

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MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010

(d) Grants and other contributions were received in respect of the following:

Consolidated Council 2010 2009 2010 2009 $'000 $'000 $'000 $'000 State Grants Roads Corporation 108 103 108 103 Appropriation - Vic Grants Comm 1,697 2,026 1,697 2,026 Tobacco Act Reform Grants 33 34 33 34 School Crossing Supervisor 49 47 49 47 Pre School Services 206 151 206 151 Support Services for Families 162 156 162 156 Maternal & Child Health 403 304 403 304 Immunisation 47 62 47 62 Home & Community Serv Grant 1,969 1,672 1,969 1,672 Senior Citizens Week -4 -4 Arts Grant 340 185 340 185 Flexible Respite Options Program 33 32 33 32 Drugs Program Grant 32 31 32 31 Disability Services Grant 101 98 101 98 Butt Littering Trust -1 -1 Parking Levy Operating Grant 1,346 1,640 1,346 1,640 Other 1,892 1,563 1,725 1,370 8,418 8,109 8,251 7,916

Consolidated Council 2010 2009 2010 2009 $'000 $'000 $'000 $'000 Federal Grants Federal Grant - Aged & Disability 150 168 150 168 Special Needs Subsidy Scheme 68 19 68 19 Federal Grant - Immunisation Register 25 21 25 21 Federal Grant- Other 1,108 211 1,108 211 1,351 419 1,351 419 Capital Grants Capital Grants 9,852 6,360 9,852 6,360 Parking Levy Capital Grant 3,654 3,360 3,654 3,360 Public Open Space Contributions 2,001 1,911 2,001 1,911 15,507 11,631 15,507 11,631 Total Other Other Contributions 614 667 614 667 Child Care Benefit 1,138 1,090 1,138 1,090 Sponsorships 1,601 771 1,601 771 3,353 2,528 3,353 2,528 Total Grants & Other Contributions 28,629 22,687 28,462 22,494

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MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010

(e) Conditions over contributions

Consolidated Council 2010 2009 2010 2009 $'000 $'000 $'000 $'000 Grants recognised as revenues during the financial year and which were obtained on the condition that they be expended in a specific manner that had not occurred at balance date were: Grants for capital works 158 570 158 570 Grants for other purposes 1,729 419 1,729 419 1,887 989 1,887 989 Deduct (i) Grants which were recognised as revenues in a prior year and which were expended during the current year in the manner specified by the grantor were: Grants for capital works 570 629 570 629 Grants for other purposes 419 730 419 730 989 1,359 989 1,359

Net increase/(decrease) in restricted assets resulting from grant revenues for the financial year 898 ( 370) 898 ( 370)

126

MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010 Note 4. Expenses from ordinary activities

Consolidated Council 2010 2009 2010 2009 $'000 $'000 $'000 $'000

(a) Employee benefit expense Wages and Salaries 125,582 114,786 77,502 70,207 Annual Leave and Long Service Leave 14,266 14,012 9,706 9,686 Fringe Benefits 1,448 1,392 517 533 WorkCover 1,825 1,566 580 498 Superannuation 10,769 9,801 6,971 6,194 153,890 141,557 95,276 87,118

(b) Contract Payments, Materials and Services Contract Payments 91,536 88,399 96,500 92,297 Other Materials and Services 80,622 82,349 39,171 38,768 Auditors' Remuneration Audit Services - VAGO 205 330 108 103 Audit Services - Other External 25 14 25 14 Audit Services - Internal 454 350 251 301 172,842 171,442 136,055 131,483

(c) Depreciation and amortisation Buildings 4,112 4,200 3,868 4,003 Buildings - Leasehold Improvements 349 363 133 133 Heritage Assets 812 775 812 775 Wharves and Promenades 1,346 1,552 1,346 1,552 Plant and equipment 13,793 12,848 4,392 4,468 Statues, Sculptures, and Artwork 513 513 513 513 Roads & Laneways 5,294 5,289 5,519 5,289 Roads & Laneways - Seal 3,521 4,038 3,296 3,521 Footpaths 12,069 11,031 12,069 11,031 Kerb & Channel 4,300 3,461 4,300 3,461 Bridges 1,220 1,184 1,220 1,184 Drains 699 676 699 676 Irrigation Systems 1,463 928 1,463 928 Parks and Gardens infrastructure 4,384 3,997 4,384 3,997 Other Structures 221 221 221 221 Furniture and fittings 634 589 512 482 54,730 51,665 44,747 42,234 Amortisation of intangibles 1,878 1,651 1,878 1,651 56,608 53,316 46,625 43,885

(d) Finance Costs Insurance 3,328 2,677 2,216 1,378 Bad and Doubtful debts 51 (184) (17) (21) Provision for Doubtful PINS 7,386 8,354 7,386 8,354 Other Financial Costs 2,814 1,474 2,207 1,548 13,579 12,321 11,792 11,259

(e) Other Expenses Grants and Contributions 16,521 15,712 16,521 15,712 Fire Brigade levy 3,443 3,435 3,443 3,435 Taxes and Levies 838 647 243 135 20,802 19,794 20,207 19,282

127

MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010 Note 5. Trade and other receivables

Consolidated Council 2010 2009 2010 2009 $'000 $'000 $'000 $'000 Current Rates 2,008 1,705 2,008 1,705 Parking Infringement Debtors 27,394 25,297 27,394 25,297 Provision for Debts - Parking Infringement (15,593) (13,336) (15,593) (13,336) Other Debtors 21,323 20,732 4,234 6,851 Provision for Doubtful Debts - Other Debtors (704) (660) (418) (441) GST Receivable 3,831 3,628 3,839 3,735 Loan to CityWide Solutions Pty Ltd -- - 47 38,259 37,366 21,464 23,858

Consolidated Council 2010 2009 2010 2009 $'000 $'000 $'000 $'000 Ageing of past due but not impaired 60-90 days 155 308 40 301 90-120 days 226 294 151 290 120+ days 373 268 328 257 Total 754 870 519 848

(ii) This disclosure relates only to Other Debtors. Rates and Parking Infringement Debtors are not financial instruments and are therefore not included.

Consolidated Council 2010 2009 2010 2009 $'000 $'000 $'000 $'000 Provision for doubtful debts Provision for Doubtful Debts - Other Debtors 704 842 418 441 Total 704 842 418 441

Movement in allowance for doubtful debts Balance at the beginning of the year 842 836 441 454 New provisions recognised 84 163 71 163 Amounts written off as uncollectible (179) (157) (94) (176) Amounts recovered during the year (43) - - - Balance at the end of the year 704 842 418 441

128

MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010 Note 6. Inventories

Consolidated Council 2010 2009 2010 2009 $'000 $'000 $'000 $'000

Stores and Raw Materials 483 387 - - Provision for Obsolete Stock (5) (5) - - 478 382 - -

Note 7. Other financial assets – non current

Consolidated Council 2010 2009 2010 2009 $'000 $'000 $'000 $'000

Interests in Controlled Entities: CityWide Service Solutions Pty Ltd - - 18,406 18,406 Queen Victoria Market Pty Ltd - - 200 200 Melbourne Wholesale Fish Market Pty Ltd - - 5,000 5,000 Investment in Sustainable Melbourne Fund - - 6,273 6,170 - - 29,879 29,776 Interests in Non- Controlled Entities: Baycorp Advantage Advantage Limited 16 16 16 16 Regent Management Company Pty Ltd 2,776 2,776 2,776 2,776 MAPS Group Ltd 250 250 250 250 3,042 3,042 3,042 3,042

3,042 3,042 32,921 32,818

Consolidated Council 2010 2009 2010 2009 Other Financial Assets $'000 $'000 $'000 $'000

BT Institutional Enhanced Fixed Interest Fund 14,664 14,275 14,664 14,275 14,664 14,275 14,664 14,275

Note 8. Other assets

Consolidated Council 2010 2009 2010 2009 $'000 $'000 $'000 $'000

Prepayments 893 806 50 95 Tax equivalents & Dividends - 20 4,596 4,538 893 826 4,646 4,633

129

MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010 Note 9. Property, plant, equipment and infrastructure

Consolidated Council 2010 2009 2010 2009 $’000 $’000 $’000 $’000 Land - Freehold At Council's valuation (i) 153,462 131,379 153,462 131,379 At Independent valuation 7,750 7,750 - - At cost 16,105 12,196 - - 177,317 151,325 153,462 131,379 Land - Other Controlled At Council's valuation (i) 1,181,150 1,164,840 1,181,150 1,164,840

Land - Under Roads At Council's deemed cost (i) 10,770 6,590 10,770 6,590

Buildings on Freehold Land At Council's valuation (i) 65,495 65,783 65,495 65,783 At cost 4,455 4,214 - - Accumulated depreciation (1,209) (965) - - 68,741 69,032 65,495 65,783 Buildings on Other Controlled Land At Council's valuation (i) 33,756 31,450 33,756 31,450

Buildings - Leasehold Improvements At cost 4,435 4,369 2,269 2,269 Accumulated depreciation (2,095) (1,746) (434) (300) 2,341 2,624 1,835 1,969 Heritage Buildings At Council's valuation (i) 91,026 81,136 91,026 81,136

Promenades and Wharves At Council's valuation (ii) 64,576 75,356 64,576 75,356

Plant and Equipment At cost 120,364 106,783 40,108 35,124 Accumulated depreciation (61,730) (51,461) (19,533) (15,775) 58,634 55,322 20,574 19,349 Furniture and Fittings At cost 5,823 5,506 4,887 4,598 Accumulated depreciation (2,643) (2,019) (2,048) (1,536) 3,180 3,487 2,839 3,062 Statues, Sculptures and Artworks At cost 49,561 49,561 49,561 49,561 Accumulated depreciation (3,744) (3,230) (3,744) (3,230) 45,817 46,331 45,817 46,331 Roads & Laneways At Council's valuation (ii) 440,205 408,412 440,205 408,412

Roads & Laneways - Seal At Council's valuation (ii) 26,266 24,716 26,266 24,716

Footpaths At Council's valuation (ii) 121,722 108,905 121,722 108,905

Kerb & Channel At Council's valuation (ii) 111,318 106,110 111,318 106,110

130

MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010 Consolidated Council 2010 2009 2010 2009 $’000 $’000 $’000 $’000

Bridges At Council's valuation (ii) 86,015 81,296 86,015 81,296

Drains At Council's valuation (ii) 75,491 69,977 75,491 69,977

Irrigation At Council's valuation (iii) 17,074 16,919 17,074 16,919

Parks and Gardens Infrastructure At Council's valuation (iv) 62,734 55,791 62,734 55,791 Trees At Council's valuation (v) 33,566 33,184 33,566 33,184

Other Structures At cost 3,660 3,660 3,660 3,660 Accumulated depreciation-cost (1,136) (915) (1,136) (915) 2,524 2,746 2,524 2,746 Works in Progress At cost 77,545 63,708 77,102 63,642

Total Property, Plant, Equipment and Infrastructure 2,791,768 2,659,254 2,725,319 2,598,941

The basis of valuation is included under note 1(k) in the financial report and have been conducted as follows:

(i) Valuations of council land and buildings were determined by David Slicer, Senior Valuer, Property Services Branch, Melbourne City Council.

(ii) Valuations of infrastructure assets (roads & laneways, footpaths, kerb & channel, bridges and drains) were determined by Gordon Duncan, Principal Engineer – Infrastructure, Engineering Services Group and Vijaya Karunasena – Senior Infrastructure Engineer, Engineering Services Branch, Melbourne City Council.

(iii) Valuation of Irrigation Assets was determined by Eugene Stackpole – Asset Management Officer, Parks Services Branch, Melbourne City Council.

(iv) Valuation of Parks and Gardens Infrastructure were determined by Eugene Stackpole – Asset Management Officer, Parks Services Branch and David Slicer – Senior Valuer, Property Services Branch, Melbourne City Council.

(v) Valuations of Trees were determined by Ian Shears – Senior Tree Planner of Parks Services Branch, Melbourne City Council.

All the above valuations were completed as at 30 June 2010 for the council. Valuations for 30 June 2010 are at fair value. Unless otherwise stated the carrying value of each class of asset measured at fair value at balance date materially reflects their fair value at that date. Land valuations for CityWide Service Solutions and the Melbourne Wholesale Fish Market were completed during March 2007 and June 2009 respectively.

131

MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010 (a) Consolidated 30 June 2009 Carrying Carrying Asset Classes amount at Revaluations Additions Disposals Depreciation amount at 30 June 2008 30 June 2009 $’000 $’000 $’000 $’000 $’000 $’000 Land - Freehold 147,170 (18,167) 22,985 (663) - 151,325 Land - Other Controlled 1,180,965 (6,630) 12,055 (21,550) - 1,164,840 Buildings on Freehold Land 72,865 (4,920) 3,838 (131) (2,620) 69,032 Buildings on Other Controlled Land 31,826 19 1,773 (586) (1,582) 31,450 Buildings - Leasehold Improvements 2,824 - 168 (8) (360) 2,624 Heritage Assets 74,786 3,592 3,534 - (776) 81,136 Promenades and Wharves 85,185 (8,275) - - (1,554) 75,356 Plant and Equipment 55,163 - 16,942 (3,936) (12,841) 55,328 Furniture and Fittings 3,442 - 626 - (587) 3,481 Statues, Sculptures and Artworks 46,773 - 69 - (511) 46,331 Roads & Laneways - Substructure 394,623 13,324 5,784 (30) (5,289) 408,412 Roads & Laneways - Seal 23,703 (5,529) 10,591 (8) (4,041) 24,716 Land Under Roads - - 6,590 - - 6,590 Footpaths 102,035 3,877 14,025 - (11,032) 108,905 Kerb & Channel 94,000 11,162 4,410 - (3,462) 106,110 Bridges 80,623 729 1,129 - (1,184) 81,297 Drains 66,041 105 4,508 - (678) 69,976 Irrigation 11,187 2,724 3,938 - (930) 16,919 Parks and Gardens Infrastructure 51,466 1,239 8,631 (1,549) (3,996) 55,791 Trees 31,691 198 1,295 - - 33,184 Other Structures 2,800 - 168 - (222) 2,746 Works in Progress* 45,141 - 18,601 (37) - 63,705 2,604,309 (6,554) 141,660 (28,498) (51,665) 2,659,254

(a) Consolidated 30 June 2010 Carrying Carrying Asset Classes amount at Revaluations Additions Disposals Depreciation amount at 30 June 2009 30 June 2010 $’000 $’000 $’000 $’000 $’000 $’000 Land - Freehold 151,325 25,838 154 - - 177,317 Land - Other Controlled 1,164,840 80,894 4,035 (68,620) - 1,181,149 Buildings on Freehold Land 69,032 (457) 2,690 - (2,523) 68,742 Buildings on Other Controlled Land 31,450 1,998 2,233 (336) (1,589) 33,756 Buildings - Leasehold Improvements 2,624 - 66 - (349) 2,341 Heritage Assets 81,136 10,702 - - (812) 91,026 Promenades and Wharves 75,356 54 (9,731) - (1,103) 64,576 Plant and Equipment 55,328 - 18,476 (1,372) (13,793) 58,639 Furniture and Fittings 3,481 - 327 - (634) 3,174 Statues, Sculptures and Artworks 46,331 - - - (513) 45,818 Roads & Laneways - Substructure 408,412 32,191 5,144 (23) (5,519) 440,205 Roads & Laneways - Seal 24,716 (1,302) 6,149 - (3,296) 26,267 Land Under Roads 6,590 - 4,180 - - 10,770 Footpaths 108,905 4,588 20,541 - (12,312) 121,722 Kerb & Channel 106,110 5,912 3,596 - (4,300) 111,318 Bridges 81,297 3,419 2,521 - (1,220) 86,017 Drains 69,976 4,007 2,205 - (699) 75,489 Irrigation 16,919 1,949 1,328 (1,662) (1,463) 17,071 Parks and Gardens Infrastructure 55,791 9,060 6,049 (3,781) (4,384) 62,735 Trees 33,184 36 801 (455) - 33,566 Other Structures 2,746 - - - (221) 2,525 Works in Progress* 63,705 - 13,840 - - 77,545 2,659,254 178,889 84,604 (76,249) (54,730) 2,791,768 * The ‘Works in progress’ addition figure is a net amount consisting of $63.9 million additional works in progress and $50.1 million of assets capitalised during the financial year 2009–10.

132

MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010 (b) Council 30 June 2009 Carrying Carrying Asset Classes amount at Revaluations Additions Disposals Depreciation amount at 30 June 2008 30 June 2009 $’000 $’000 $’000 $’000 $’000 $’000 Land - Freehold 118,439 (10,045) 22,985 - - 131,379 Land - Other Controlled 1,180,965 (6,630) 12,055 (21,550) - 1,164,840 Buildings on Freehold Land 70,321 (4,920) 2,805 (2,423) 65,783 Buildings on Other Controlled Land 31,826 19 1,773 (586) (1,582) 31,450 Buildings - Leasehold Improvements 2,102 - - - (131) 1,971 Heritage Assets 74,786 3,592 3,534 - (776) 81,136 Promenades and Wharves 85,185 (8,275) - - (1,553) 75,357 Plant and Equipment 18,238 - 6,350 (773) (4,460) 19,355 Furniture and Fittings 3,409 - 128 - (481) 3,056 Statues, Sculptures and Artworks 46,773 - 69 - (511) 46,331 Roads & Laneways - Substructure 394,623 13,324 5,784 (30) (5,291) 408,410 Roads & Laneways - Seal 23,703 (5,529) 10,074 (8) (3,521) 24,719 Land Under Roads - - 6,590 - - 6,590 Footpaths 102,035 3,877 14,025 - (11,030) 108,907 Kerb & Channel 94,000 11,162 4,410 - (3,461) 106,111 Bridges 80,623 729 1,129 - (1,185) 81,296 Drains 66,041 105 4,508 - (678) 69,976 Irrigation 11,187 2,724 3,938 - (931) 16,918 Parks and Gardens Infrastructure 51,466 1,239 8,631 (1,549) (3,998) 55,789 Trees 31,691 198 1,295 - - 33,184 Other Structures 2,800 - 168 - (222) 2,746 Works in Progress* 45,025 - 18,612 - - 63,637 2,535,238 1,568 128,863 (24,496) (42,234) 2,598,941

(b) Council 30 June 2010 Carrying Carrying Asset Classes amount at Revaluations Additions Disposals Depreciation amount at 30 June 2009 30 June 2010 $’000 $’000 $’000 $’000 $’000 $’000 Land - Freehold 131,379 21,928 154 - - 153,461 Land - Other Controlled 1,164,840 80,894 4,035 (68,620) - 1,181,149 Buildings on Freehold Land 65,783 (457) 2,449 - (2,279) 65,496 Buildings on Other Controlled Land 31,450 1,998 2,233 (336) (1,589) 33,756 Buildings - Leasehold Improvements 1,971 - - - (133) 1,838 Heritage Assets 81,136 10,702 - - (812) 91,026 Promenades and Wharves 75,357 54 (9,731) - (1,103) 64,577 Plant and Equipment 19,355 - 6,489 (872) (4,392) 20,580 Furniture and Fittings 3,056 - 288 - (512) 2,832 Statues, Sculptures and Artworks 46,331 - - - (513) 45,818 Roads & Laneways - Substructure 408,410 32,191 5,144 (23) (5,519) 440,203 Roads & Laneways - Seal 24,719 (1,302) 6,149 - (3,296) 26,270 Land Under Roads 6,590 - 4,180 - - 10,770 Footpaths 108,907 4,588 20,541 - (12,312) 121,724 Kerb & Channel 106,111 5,912 3,596 - (4,300) 111,319 Bridges 81,296 3,419 2,521 - (1,220) 86,016 Drains 69,976 4,007 2,205 - (699) 75,489 Irrigation 16,918 1,949 1,328 (1,662) (1,463) 17,070 Parks and Gardens Infrastructure 55,789 10,233 4,876 (3,781) (4,384) 62,733 Trees 33,184 36 801 (455) - 33,566 Other Structures 2,746 - - - (221) 2,525 Works in Progress* 63,637 - 13,464 - - 77,101 2,598,941 176,152 70,722 (75,749) (44,747) 2,725,319 * The ‘Works in progress’ addition figure is a net amount consisting of $63.6 million additional works in progress and $50.1 million of assets capitalised during the financial year 2009–10.

133

MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010 Note 10. Intangible assets

(a) Consolidated Carrying Carrying Carrying Asset Classes amount at Additions Disposals Amortisation/ amount at Additions Disposals Amortisation amount at 30 June 2008 Impairment 30 June 2009 30 June 2010 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 Goodwill Net Book value 9,230 621 - - 9,851 - - - 9,851

Licence Agreement ------

Computer Software Cost 12,672 1,554 - - 14,226 2,636 - - 16,862 Accumulated amortisation (8,928) - - (1,651) (10,579) - - (1,878) (12,457) Net Book value 3,744 1,554 - (1,651) 3,647 2,636 - (1,878) 4,405 12,974 2,175 - (1,651) 13,498 2,636 - (1,878) 14,256

(b) Council Carrying Carrying Carrying Asset Classes amount at Additions Disposals Amortisation amount at Additions Disposals Amortisation amount at 30 June 2008 30 June 2009 30 June 2010 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 Licence Agreement ------

134

MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010 Note 11. Investment property

Consolidated Council 2010 2009 2010 2009 $’000 $’000 $’000 $’000

(a) Amounts recognised in Income Statement for Investment Properties Property Rental 9,313 8,411 9,313 8,411 Operating Expenses for rental generating properties 2,307 2,233 2,307 2,233 Operating Expenses for non rental generating properties 6,493 6,837 6,493 6,837

(b) Reconciliation of carrying amounts Land Carrying amount at beginning 32,255 25,280 32,255 25,280 Additions (154) 6,975 (154) 6,975 Carrying amount at end of period 32,101 32,255 32,101 32,255

Buildings Carrying amount at beginning 57,191 54,056 57,191 54,056 Additions 7,604 3,135 7,604 3,135 Carrying amount at end of period 64,795 57,191 64,795 57,191

Total Investment Properties 96,896 89,446 96,896 89,446

135

MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010 Note 12. Trade and other payables

Consolidated Council 2010 2009 2010 2009 $'000 $'000 $'000 $'000

Current Trade Creditors General 7,818 16,113 917 12,758 Docklands Payable 1,500 1,500 1,500 1,500 CAE - Payable - 590 - 590 Deposits and retention amounts 3,688 3,775 1,969 2,778 Accruals 30,929 29,477 23,966 24,946 Income in Advance 3,094 2,485 789 1,099 47,029 53,940 29,141 43,671

Note 12(a) Trade and other payables (non-current)

Consolidated Council 2010 2009 2010 2009 $'000 $'000 $'000 $'000 Non-Current Docklands Payable 6,322 6,850 6,322 6,850 6,322 6,850 6,322 6,850

136

MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements F or the year ended 30 June 2010 Note 13. Employee benefits

Consolidated Council 2010 2009 2010 2009 $'000 $'000 $'000 $'000 (a) Current Long Service Leave 14,986 13,753 11,338 10,564 Annual Leave 12,626 11,727 8,096 7,551 Other 168 - - - 27,780 25,480 19,434 18,115 (b) Non-Current Long Service Leave 5,735 5,208 3,908 3,656 Annual Leave - - - - 5,735 5,208 3,908 3,656 Total Employee Benefits 33,515 30,688 23,342 21,771

(c) Reconciliation of movements Annual Leave Balance at the beginning of the financial year 11,727 11,033 7,551 7,012 Additional provisions 7,485 6,908 7,131 6,753 Amounts used (6,584) (6,211) (6,584) (6,211) Increase in the discounted amount because of time and the effect of any change in the discount rate (2) (3) (2) (3) Balance at the end of the financial year 12,626 11,727 8,096 7,551

Long Service Leave Balance at the beginning of the financial year 18,961 16,012 14,220 12,119 Additional provisions 2,301 4,710 1,567 3,862 Amounts used (1,360) (1,023) (1,360) (1,023)

Increase(Decrease) in the discounted amount because of time and the effect of any change in the discount rate 819 (738) 819 (738) Balance at the end of the financial year 20,721 18,961 15,246 14,220

Other Balance at the beginning of the financial year - - - - Additional provisions 168 - - - Amounts used - - - - Balance at the end of the financial year 168 - - -

(e) Current Employee Benefits Disclosure Employee Benefits entitlements - that fall due within 12 months after the end of the period measured at nominal value 13,610 12,543 8,938 8,367 - that do not fall due within 12 months after the end of the period measured at present value 14,170 12,937 10,496 9,748 27,780 25,480 19,434 18,115

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MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements F or the year ended 30 June 2010 Note 14. Provisions

Consolidated Council 2010 2009 2010 2009 $'000 $'000 $'000 $'000 (a) Current Insurance claims 551 167 551 167 Other 959 455 765 300 1,510 622 1,316 467

(b) Reconciliation of movements Insurance Claims Balance at the beginning of the financial year 167 255 167 255 Additional provisions 496 53 496 53 Amounts used (112) (141) (112) (141) Balance at the end of the financial year 551 167 551 167

Other Balance at the beginning of the financial year 455 500 300 300 Additional provisions 504 465 - Amounts used - (45) - Balance at the end of the financial year 959 455 765 300

Note 15. Reserves

Consolidated Council 2010 2009 2010 2009 $'000 $'000 $'000 $'000 Composition

Asset Revaluation (i) 1,255,718 1,076,829 1,244,558 1,068,406 Reserve for Public Open Space (ii) 2,539 2,139 2,539 2,139 Investments Revaluation Reserve (iii) (336) (725) (336) (725) 1,257,920 1,078,243 1,246,760 1,069,820

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MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010

(i) Movement in Reserves -Asset Revaluation Reserve

Consolidated Carrying Carrying Carrying amount at Increment amount at Increment amount at 2008 (decrement) 2009 (decrement) 2010 Property $’000 $’000 $’000 $’000 $’000 Land 727,475 (24,797) 702,678 102,822 805,500 Buildings 35,446 (1,310) 34,136 12,243 46,379

Infrastructure Roads & Laneways 106,272 7,795 114,067 30,890 144,957 Footpaths 52,978 3,877 56,855 4,586 61,441 Kerb & Channel 72,774 11,162 83,936 5,912 89,848 Bridges 18,131 729 18,860 3,419 22,279 Drains 3,155 105 3,260 4,007 7,267 Promenades and Wharves 11,010 (8,276) 2,734 54 2,788 Parks and Gardens Infrastructure 33,052 1,239 34,291 10,233 44,524 Trees 10,284 198 10,482 36 10,518 Other structures 206 - 206 - 206 P&G Irrigation 2,095 2,724 4,819 1,950 6,769 Plant & Equipment 547 - 547 - 547 Computer Equipment 635 - 635 - 635 Furniture & Fittings 9 - 9 - 9 Artworks 5,404 - 5,404 - 5,405 Asset Revaln Res - CW Services 3,909 - 3,909 2,737 6,646 1,083,382 (6,554) 1,076,829 178,889 1,255,718

(ii) Movement in Reserves -Asset Revaluation Reserve

Council Carrying Carrying Carrying amount at Increment amount at Increment amount at 2008 (decrement) 2009 (decrement) 2010 Property $’000 $’000 $’000 $’000 $’000 Land 714,840 (16,675) 698,165 102,822 800,987 Buildings 35,446 (1,310) 34,136 12,243 46,379

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MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010

(ii) Movements in Reserves - Reserve for Public Open Space Consolidated Note Council 2010 2009 2010 2009 $'000 $'000 $'000 $'000

Balance at the beginning of the financial year 2,139 2,390 2,139 2,390 Transfer to accumulated reserves 2,218 2,055 2,218 2,055 Amounts used (1,818) (2,306) (1,818) (2,306) Balance at the end of the financial year 2,539 2,139 2,539 2,139

(iii) Movements in Reserves - Investments Consolidated Note Council Council Revaluation Reserve 2010 2009 2010 2009 $'000 $'000 $'000 $'000

Balance at the beginning of the financial year (725) (621) (725) (621) Transfer to accumulated reserves 389 (104) 389 (104) Amounts used - - - - Balance at the end of the financial year (336) (725) (336) (725)

Note 16. Gains/ (loss) on sale of fixed and intangible assets

Consolidated Council 2010 2009 2010 2009 $'000 $'000 $'000 $'000 Land & Buildings Proceeds from Sales - - - - Carrying amount of assets sold (336) (2,751) (336) (2,751) Gain/(Loss) on Sale (336) (2,751) (336) (2,751) Plant, Equipment & Infrastructure Proceeds from Sales 931 1,420 931 1,420 Carrying amount of assets sold/disposed (747) (1,316) (916) (1,018) Gain/(Loss) on Sale 184 104 15 402

Total Proceeds from Sale of Assets 931 1,420 931 1,420 Total Carrying amount of Assets Sold (1,084) (4,067) (1,252) (3,769) Total Gain/(Loss) on Sale (153) (2,647) (321) (2,349)

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MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010

Note 17. Cash flow information

(a) Reconciliation from net cash provided by operating activities to surplus(deficit)

Consolidated Council 2010 2009 2010 2009 $'000 $'000 Note $'000 $'000

Comprehensive result 155,990 8,414 150,033 26,458 Non cash and other items included in Comprehensive Income for the year: Depreciation and amortisation 56,608 53,316 46,625 43,885 (Gain)/Loss on sale of property, plant and equipment 153 2,647 321 2,349 Recognition of change in reserves (179,277) 20,794 (176,542) (1,464) Finance costs from financing activities 4,885 12,794 2,989 2,026 Transfer of Assets to external parties 74,496 23,475 74,496 23,475 Non current asset additions (17,255) (18,821) (17,255) (18,821)

Changes in assets and liabilities in relation to operating activities: (Increase)/Decrease in Trade and other Receivables (1,047) 3,054 2,278 (2,163) (Increase)/Decrease in Other Assets (67) (245) (13) (122) (Increase)/Decrease in Inventories (96) 115 -- (Increase)/Decrease in Assets held for sale - 2,770 - 2,770 (Increase)/Decrease in Accrued Income (766) (274) (835) (476) Increase/(Decrease) in Trade and other Payables (5,723) (22,572) (14,050) (9,651) Increase/(Decrease) in Superannuation Liability 802 14,482 -- Increase/(Decrease) in Employee benefits 2,827 2,983 1,570 1,980 Increase/(Decrease) in Provisions 888 (132) 849 (89) Net cash provided by operating activities 92,421 102,800 70,465 70,158

(b) Cash and Cash Equivalents Cash at the end of the financial year as shown in the balance sheet and the statement of cash flows comprises:

Cash on hand 78 63 23 48 31 Cash at bank 6,278 3,803 23 3,315 2,283 Bank Bills, Negotiable Certificates of Deposit 108,749 107,604 23 99,538 96,723 Cash and Cash Equivalents 115,105 111,470 102,901 99,037 Fixed Interest securities 14,664 14,275 23 14,664 14,275 129,769 125,745 117,565 113,312

(c) Restriction on Investments Council has cash and cash equivalents (note 17b) that are subject to restrictions. As at the reporting date, Council had legislative restrictions in relation to employee entitlements (Long Service Leave) and reserve funds (Recreational Lands Reserves). Long Service Leave 20,721 18,961 15,246 14,220 Reserve Funds 2,539 2,139 2,539 2,139 23,260 21,100 17,785 16,359

Short-term deposits, bank bills, NCDs and fixed interest securities as at 30 June 2010 had a weighted average duration of approximately 249 days (2009: 209 days) and a weighted average interest rate of 6.22 per cent (2009 : 4.05 per cent).

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MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010

Note 18. Leases and Commitments

Consolidated Council COMMITMENTS 2010 2009 2010 2009 (i) Operating leases payable $'000 $'000 $'000 $'000 Operating lease rentals of property, contracted for at balance date, but not recognised as liabilities: Not longer than 1 year 64 70 134 140 Longer than 1 year but no longer than 5 years 199 226 199 226 Longer than 5 years 172 150 172 150 435 446 505 516

Operating Maintenance commitments Payable within 1 year 6,400 1,479 6,400 1,479 Longer than 1 year but no longer than 5 years 20,648 - 20,648 - 27,048 1,479 27,048 1,479

Service* Payable within 1 year 18,401 32,942 51,976 52,964 Payable later than 1 year but not later than 5 years 18,580 110,070 93,486 133,171 36,981 143,012 145,462 186,135

Consolidated Council (ii) RECEIVABLES 2010 2009 2010 2009 Operating leases receivable $'000 $'000 $'000 $'000 Future minimum lease receipts under non-cancellable operating leases for rentals of property, contracted for at balance date, but not recognised as assets: Not longer than 1 year 4,308 3,607 4,308 3,607 Longer than 1 year but no longer than 5 years 5,494 8,488 5,494 8,488 Longer than 5 years 29,120 25,024 29,120 25,024 38,922 37,119 38,922 37,119

Consolidated Council (iii) CAPITAL COMMITMENTS 2010 2009 2010 2009 Expenditure contracted for at balance date but $'000 $'000 $'000 $'000 not recognised in the financial report as liabilities: CAPITAL Buildings 1,365 1,802 1,365 1,802 Plant and Equipment 899 1,406 899 1,406 2,264 3,208 2,264 3,208 Payable within 1 year 2,264 3,208 2,264 3,208 * Service contracts are for a maximum period of five years.

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MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010

Note 19. Contingent assets and liabilities

Guarantees

Melbourne City Council and the State Government of Victoria have indemnified, in equal shares, Regent Management Company Pty Ltd against any liability, loss or expense incurred or suffered by the company. Over the financial year, no calls on this indemnity were made.

Melbourne City Council, as a once-off arrangement, agrees to act as guarantor for Fencing Victoria’s loan of $241,000 for their capital contribution towards the State High Performance Centre, which will be completed as part of the Arden Street redevelopment. Over the financial year, no calls on this indemnity were made.

At the time of preparing the financial statements, Melbourne City Council was yet to finalise its enterprise bargaining agreement. Part of the new agreement may see the timeframe for entitlement of long service leave for employees reduced from 10 years to 7 years. If the agreement is accepted Melbourne City Council’s current long service liability would increase by $1.01 million.

At 30 June 2010 there are no outstanding Melbourne City Council bank guarantees.

Note 19a. Melbourne Wholesale Fish Market

The Melbourne Wholesale Fish Market will cease operating on December 31, 2010.

The company has now entered into a conditional contract of sale for the remainder of the site which is subject to satisfactory due diligence and an agreement on demolition costs for the buildings on the site.

The requirements of the due diligence process have not been completed at the time of preparing and signing the financial statements. As there are a number of conditions still to be satisfied the property is carried as a non-current asset in the consolidated financial statements at estimated fair value which has been determined after allowing for reasonable demolition costs. Any further adjustments arising from the sale will be accounted for in the 2011 financial statements however these are not expected to be material in amount or nature.

Note 19b. Contributed assets

During the financial year, total contributed assets of $17.30 million were received. This predominantly comprised of assets from Docklands.

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MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010

Note 20. Superannuation

The City of Melbourne makes employer superannuation contributions in respect of its employees to the Local Authorities Superannuation Fund (the Fund). Obligations for contributions are recognised as an expense in the comprehensive income statement when they are due. The Fund has two categories of membership, accumulation and defined benefit, each of which is funded differently. The Fund's accumulation category, Vision Super Saver, receives both employer and employee contributions on a progressive basis. Employer contributions are normally based on a fixed percentage of employee earnings (9% required under Superannuation Guarantee Legislation). No further liability accrues to the employer as the superannuation benefits accruing to employees are represented by their share of the net assets of the Fund.

Defined Benefit Plan The Fund's Defined Benefit Plan is a multi-employer sponsored plan. As the Plan's assets and liabilities are pooled and are not allocated by employer, the Actuary is unable to reliably allocate benefit liabilities, assets and costs between employers. As provided under Paragraph 32 (b) of AASB 119, City of Melbourne does not use defined benefit accounting for these contributions.

The City of Melbourne makes employer contributions to the defined benefit category of the Fund at rates determined by the Trustee on the advice of the Fund's Actuary. On the basis of the results of the most recent full actuarial investigation conducted by the Fund's Actuary as at 31 December 2008, City of Melbourne makes the following contributions:-

- 9.25% of members' salaries (same as previous year); - the difference between resignation and retrenchment benefits paid to any retrenched employees, plus contribution tax (same as previous year); The Fund surplus or deficit (ie the difference between fund assets and liabilities) is calculated differently for funding purposes (ie calculating required contributions) and for the calculation of accrued benefits as required in AAS 25 to provide the values needed for the AASB 119 disclosure in the council's financial statements. AAS 25 requires that the present value of the defined benefit liability to be calculated based on benefits that have accrued in respect of membership of the plan up to the measurement date, with no allowance for future benefits that may accrue. The actuarial investigation concluded that although the Net Market Value of Assets was in excess of Accrued Benefits at 31 December 2008, based on the assumptions adopted, there was a shortfall of $71 million when the funding of future benefits was also considered. However, the City of Melbourne was advised that no additional contributions are required for 30 June 2010. The Actuary has commenced undertaking the next actuarial investigation to ascertain if additional contributions would be required. The Actuarial review will be as at 30 June 2010. The result of the actuarial review is expected to be finalised during October 2010. Should the review identify a funding shortfall requiring additional contributions, the City of Melbourne will be notified of any amount payable by November 2010 for payment on 1 July 2011. A further actuarial review will be undertaken as at 30 June 2011. Based on the result of this further review, a detailed funding plan will be developed and implemented to achieve the target of fully funding the Fund by 31 December 2013.

Accounting Standard Disclosure The Fund's liability for accrued benefits was determined by the Actuary at 31 December 2008 pursuant to the requirements of Australian Accounting Standard AAS25 follows: 31-Dec-08 $'000 Net Market Value of Assets 3,630,432 Accrued Benefits 3,616,422 Difference between Assets and Accrued Benefits 14,010 Vested Benefits (Minimum sum which must be paid to members when they leave the fund) 3,561,588

The financial assumptions used to calculate the Accrued Benefits for the defined benefit category of the Fund were:

Net Investment Return 8.50% p.a. Salary Inflation 4.25% p.a. Price Inflation 2.75% p.a.

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MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010

Melbourne City Council Superannuation Sub Plan (CMSSP) Members

A separate plan is operated for Melbourne City Council defined benefit members. The CMSSP was closed to new members on 23 December 1993.

The CMSSP is a multi-employer sponsored plan. As the fund's assets and liabilities are pooled and are not allocated by employer, the Actuary is unable to reliably allocate benefit liabilities, assets and costs between employers. As provided under Paragraph 32 (b) of AASB 119, council does not use the defined benefit accounting for these contributions, but as the majority of the members of the fund are employees of the Melbourne City Council group, the surplus or deficit of the fund is recorded in accordance to AASB119 at the consolidated level for reporting purposes. Member profiles will be reviewed periodically to determine if and when reporting at the individual entity level becomes appropriate.

The Melbourne City Council makes employer contributions to the defined benefits category of the fund at rates determined by the fund’s trustee on advice of the actuary. On the basis of the results of the most recent update of the full actuarial investigation conducted by the fund’s actuary as at 31 December 2008, the trustee has determined that the funding arrangements were adequate for the expected CMSSP liabilities and Melbourne City Council makes the following contributions:

• 8 per cent of members’ salaries (up until 30 November 2006), and 4 per cent thereafter • the difference between resignation and retrenchment benefits paid to its retrenched employees (same as the previous year).

The actuarial investigation concluded that although the net market value of assets was in excess of accrued benefits at 31 December 2008, based on the assumptions adopted, there was a shortfall for when the funding of future benefits was also considered. A liability of $11.16 million has been recognised in the consolidated financial statements as the council’s share of the scheme’s liabilities, being the difference between the present value of employees’ accrued benefits and the net market value of the scheme’s assets at balance date. The Actuary will undertake the next actuarial investigation commencing at 30 June 2010 to ascertain if additional contributions are required.

The CMSSP fund’s liability was determined in the 31 December 2008 actuarial investigation pursuant to the requirements of the Australian Accounting Standard AAS 25 as follows:

31 Dec 2008 $ millions Net Market Value of Assets 60.4 Accrued Benefits (per accounting standards) 51.4 Difference between Assets and Accrued 9.0 Benefits Vested Benefits 58.7 Vested benefits index 114%

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MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010

The total amount of superannuation contributions paid by Melbourne City Council, inclusive of its wholly owned subsidiaries Citywide Service Solutions Pty Ltd, Queen Victoria Market Pty Ltd and Melbourne Wholesale Fish Market Pty Ltd, during the year was $10,751,370 (2009: $9,800,615).

Council has an ongoing obligation to share in the future experience of the Local Authorities Superannuation Fund Defined Benefits Plan and the Melbourne City Council Superannuation Sub- Plan. Favourable or unfavourable variations may arise should the experience of the funds differ from the assumptions made by the funds’ actuary in estimating the Funds’ accrued benefit liability.

CityWide Service Solutions Pty Ltd contributes in respect of its employees to the following sub-plans of the Local Authorities Superannuation Fund:

• The Melbourne City Council sub-plan • The Defined Benefits plan • The Accumulation plan.

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MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010

Note 21. Related party transactions

(a) Names of persons holding the position of a Responsible Person at the Melbourne City Council during the financial year were: Councillors LM Robert Doyle DLM Susan Riley Carl Jetter Kevin Louey Jennifer Kanis Cathy Oke Brian Shanahan Ken Ong Peter Clarke

Chief Executive Officer Kathy Alexander

(b) Remuneration of Responsible Persons in bands of $ 20,000 2010 2009 Income Range No. No. $0,000 - $19,999 - 1 $20,000 - $39,999 - 10 $40,000 - $59,999 7 3 $80,000 - $99,999 - 1 $100,000 - $119,999 1 - $160,000 - $179,999 1 - $360,000 - $379,999 1 1 10 16

2010 2009 $'000 $'000 Total Remuneration for the financial year for Responsible Persons included above, amounted to: 988 919

(c) Senior Officers' Remuneration The number of Senior Officers, other than the Responsible Persons, whose total remuneration exceeded $120,000 during the financial year, are shown below in their relevant income bands:

2010 2009 Income Range No. No.

$120,000 - $139,999 22 11 $140,000 - $159,999 12 10 $160,000 - $179,999 15 8 $180,000 - $199,999 6 10 $200,000 - $219,999 3 3 $220,000 - $239,999 2 2 $240,000 - $259,999 - 1 $260,000 - $279,999 2 $280,000 - $299,999 2 $300,000 - $319,999 2 1 $320,000 - $339,999 - 2 $340,000 - $359,999 1 - $360,000 - $379,999 - 2 67 50

2010 2009 $'000 $'000 Total Remuneration for the financial year for Senior Officers included above, amounted to: 11,487 9,207

The recognition criteria for a senior officer was amended to reflect remuneration in excess of $120,000 in Local Government (General) Amendment Regulations 2009. The statutory accounts have been adjusted accordingly for 2010 and 2009.

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MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010

(d) No retirement benefits were paid by the council in connection with the retirement of responsible persons during the financial year or in the previous financial year.

(e) Other transactions

Other related party transactions requiring disclosure this financial year have been considered and there are no matters to report. There were no matters to report in the previous financial year.

(f) Wholly-owned group

Melbourne City Council is the ultimate parent entity in the wholly-owned group. Transactions with the controlled entities, CityWide Service Solutions Pty Ltd, Queen Victoria Market Pty Ltd, Melbourne Wholesale Fish Market Pty Ltd and Sustainable Melbourne Fund Trust during the year comprised of the following: car rental services, provision of accounting and administration services, property rental, contract sales, purchases of raw materials and plant and equipment and in accordance with the Tax Equivalence Policy, the receipt of payments which included tax equivalents for income tax, and payroll tax where applicable. These transactions were made on normal commercial terms and conditions and at market rates.

(g) Other related party transactions

Council 2010 2009 $'000 $'000 Other related party transactions Debtor - CityWide Service Solutions Pty Ltd 2,765 2,425 Debtor - Queen Victoria Market Pty Ltd 3 435 2,768 2,860 Creditor - CityWide Service Solutions Pty Ltd 7,057 9,460 Creditor - Queen Victoria Market Pty Ltd 90 292 7,147 9,752

Loans Outstanding Interest bearing loan to CityWide Service Solutions Pty Ltd - 47

Intercompany Revenue Dividends 4,537 7032 Interest on loan to CityWide Service Solutions Pty Ltd 1 10 Other 8,889 9,014 Total Intercompany Revenue 13,428 16,056

Intercompany Expenditure CityWide Service Solutions Pty Ltd 52,720 47,152 Total Intercompany Expenditure 52,720 47,152

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MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010

Note 22. Financial instruments

Accounting policy, terms and conditions

Financial Note Accounting policy Terms and conditions instruments Financial assets Cash and cash 17 Cash on hand, cash at bank and Council: On call deposits returned a equivalents money market call account are floating interest rate of 4.36% (2.83% valued at face value. in 2008–2009).

Bank bills, 17 Interest is recognised as it Council: Managed fund provided negotiable and accrues. return of 7.22% (5.11% in 2008– transferrable 2009) excluding unrealised certificates of Investments and bills are valued gains/losses deposits and at cost. fixed interest Investments are held to maximise interest returns of surplus cash. Fixed interest securities are valued at fair value. Trade and other receivables Sundry debtors 5 Receivables are carried at General debtors are unsecured. (including nominal amounts due less any Docklands and provision for doubtful debts. A Credit terms are based on 30 days Kensington/North provision for doubtful debts is from date of invoice. Melbourne) recognised when collection in full is no longer probable. Collectability of overdue accounts is assessed on an ongoing basis. Docklands debtors and Kensington/North Melbourne debtors have been recognised at carrying value, as recorded at the time of transition per the financial records of the responsible entity.

Investments 7 Investments for the council Investments in other entities are include all wholly owned valued at historical cost. subsidiaries, wholly controlled trust of the council and 149

MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010

associated entities. Investments the consolidated entity includes interests in other entities and associated entities. Financial liabilities Trade and other 12 Liabilities are recognised for General creditors are unsecured, not payables amounts to be paid in the future subject to interest charges and are for goods and services provided normally settled within 30 days from to council as at balance date date of invoice. whether or not invoices have been received. Borrowings Borrowings are carried at their CityWide: The bank overdraft and bill principal amounts, which acceptance and discount facilities represent the present value of are unsecured facilitates. The bank future cash flows associated with facilities may be drawn at any time the servicing of debt. Interest is and may be terminated by the bank recognised as an expense as it is subject to default under the loan incurred. agreement. Subject to the continuance of satisfactory covenant achievement, the bank facilities may be drawn at any time. The facilities expire on 1 December 2010. The weighted average interest rate was 3.83% in 2010 (4.81% in 2009) Council: The Melbourne City Council has no borrowings. No defaults or breaches of any loan/debt facility arrangements involving council or its consolidated group occurred during the financial year ended 30 June 2010.

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MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010

(a) Interest rate risk

(i) The consolidated entity's exposure to interest rate risk, repricing maturities and effective weighted average interest rates on financial instruments at balance date is set out below:

Weighted Average Fixed Interest Interest Floating Rate Maturities Non interest rate % Interest rate 1 year or less bearing Total 2010 2009 2010 2009 2010 2009 2010 2009 2010 2009 % % $ '000 $ '000 $ '000 $ '000 $ '000 $ '000 $ '000 $ '000 Financial Assets Cash 4.31% 2.83% 7,217 3,803 - - 78 64 7,295 3,867 Short term deposits 6.01% 3.48% - - 100,568 - - - 100,568 - Bank Bills & NCD's 7.22% 5.11% 21,663 - - 121,878 - - 21,663 121,878 Sundry debtors --- - 18,611 18,367 18,611 35,661 Investment in unlisted entities --- - 3,042 3,042 3,042 3,042 Total Financial Assets 28,880 3,803 100,568 121,878 21,731 21,473 151,179 164,448

Financial Liabilities Trade creditors --- - 9,318 18,203 9,318 18,203 Deposits & retentions --- - 3,688 3,775 3,688 3,775 Borrowings 3.83% 4.81% 1,000 7,500 - - - - 1,000 7,500 Total Financial Liabilities 1,000 7,500 - - 13,006 21,978 14,006 29,478

Net financial assets/Liabilities 27,880 (3,697) 100,568 121,878 8,725 (505) 137,173 134,970

Comparative figures in non-interest bearing Sundry Debtors has been adjusted to exclude Rates, Parking Infringments and GST Receivable Debtors to be consistent with the current year.

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MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010

(ii) The council’s exposure to interest rate risk, repricing maturities and effective weighted average interest rates on financial instruments at balance date is set out below:

Weighted Average Fixed Interest Interest Floating Rate Maturities Non interest rate % Interest rate 1 year or less bearing Total 2010 2009 2010 2009 2010 2009 2010 2009 2010 2009 % % $ '000 $ '000 $ '000 $ '000 $ '000 $ '000 $ '000 $ '000 Financial Assets Cash 4.36% 2.88% 3,315 2,283 - - 48 32 3,363 2,315 Short term deposits 6.01% --92,538- - -92,538 - Bank Bills & NCD's 7.22% 5.14% 21,663 - - 110,997 - - 21,663 110,997 Sundry debtors --- - 1,808 4,752 1,808 22,153 Investment in unlisted entities --- - 32,921 32,818 32,921 32,818 Total Financial Assets 24,978 2,283 92,538 110,997 34,777 37,603 152,294 168,283

Financial Liabilities Bank Overdraft Trade creditors --- - 2,417 14,848 2,417 14,848 Deposits & retentions --- - 1,969 2,778 1,969 2,778 Total Financial Liabilities --- - 4,386 17,626 4,386 17,626

Net financial assets 24,978 2,283 92,538 110,997 30,391 19,977 147,908 150,657

Comparative figures in non-interest bearing Sundry Debtors has been adjusted to exclude Rates, Parking Infringments and GST Receivable Debtors to be consistent with the current year.

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MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010

(b) Reconciliation of net financial assets to net assets

Consolidated Council 2010 2009 2010 2009 $ '000 $ '000 Note $ '000 $ '000

Net financial assets as above 137,173 134,970 147,908 150,658

Non financial assets and liabilities: Inventories 478 382 6 - - Intangible Assets 14,256 13,498 10 4,405 3,647 Other assets 22,649 3,931 25,054 6,558 Rate debtors 2,008 1,705 2,008 1,705 Property, Infrastructure, Plant & Equipment 2,791,768 2,659,254 9 2,725,319 2,598,941 Investment Properties 96,896 89,446 96,896 89,446 Net Assets/(Liabilities) Defined Super Fund (11,157) (10,355) - - Accruals (30,929) (29,477) 12 (23,966) (24,946) Income in advance (3,094) (2,485) 12 (789) (1,099) Employee Entitlements (33,515) (30,688) 13 (23,342) (21,771) Provisions (1,510) (622) 14 (1,316) (467) Non Current Payables (6,322) (6,849) 12a (6,322) (6,849)

Net assets per Balance Sheet 2,978,700 2,822,710 2,945,856 2,795,822

Note: Refer to note 5i page 129 for detail on trade debtors, provisions and bad debts.

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MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010

The aggregate net fair value of financial assets and financial liabilities, both recognised and unrecognised at balance date are as follows:

Consolidated Council Carrying Net Fair Carrying Net Fair Carrying Net Fair Carrying Net Fair Amount Value Amount Value Amount Value Amount Value

$ 000's $ 000's $ 000's $ 000's $ 000's $ 000's $ 000's $ 000's 2010 2010 2009 2009 2010 2010 2009 2009 Financial Assets Assets Cash 7 295 7 295 3 866 3 866 3 363 3 363 2 315 2 315 Sundry Debtors 18 611 18 611 35 661 35 661 1 808 1 808 22 153 22 153 Short term deposits 100 568 100 568 - - 92 538 92 538 - - Bank bills & NCD's 21 663 21 663 121 878 121 878 21 663 21 663 110 997 110 997 Investment in unlisted entities 3 042 3 042 3 042 3 042 32 921 32 921 32 818 32 818 Total financial assets 151 179 151 179 164 447 164 447 152 294 152 294 168 283 168 283

Financial Liabilities Liabilities Trade creditors 9 318 9 318 18 203 18 203 2 417 2 417 14 848 14 848 Deposits and retentions 3 688 3 688 3 775 3 775 1 969 1 969 2 778 2 778 Borrowings 1 000 1 000 7 500 7 500 -- - - Total financial liabilities 14 006 14 006 29 478 29 478 4 386 4 386 17 626 17 626

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MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010

The following methods and assumptions are used to determine the net fair values of financial assets and liabilities:

• Cash, cash equivalents and short-term deposits – the carrying amount approximates fair value because of their short term to maturity. • Trade debtors and creditors – the carrying amount approximates fair value. • Bank bills and negotiable certificates of deposits – there are market prices quoted daily for securities issued by any of the major four banks. • For any other securities, a reasonable estimate of the fair value has been determined by reference to the current market value of a quoted security, and adding a credit risk margin, which is determined by reference to historical data. • Fixed interest investments are valued at fair value.

(d) Credit risk exposures

The credit risk on financial assets of the economic entity which have been recognised in the balance sheet is generally the carrying amount, net of any provisions for doubtful debts.

(e) Risks and mitigation

The risks associated with our main financial instruments and our policies for minimising these risks are detailed below. Market risk

Market risk is the risk that the fair value or future cash flows of our financial instruments will fluctuate because of changes in market prices. The council's exposures to market risk are primarily through interest rate risk with only insignificant exposure to other price risks and no exposure to foreign currency risk. Components of market risk to which we are exposed are discussed below. Interest rate risk

Interest rate risk refers to the risk that the value of a financial instrument or cash flows associated with the instrument will fluctuate due to changes in market interest rates. Interest rate risk arises from the interest bearing financial assets and liabilities that we use. Non derivative interest bearing assets are predominantly short term liquid assets. Our interest rate liability risk is limited to our subsidiary company’s (CityWide) borrowings. Council has no direct borrowings.

Our subsidiary company CityWide has a borrowing and overdraft facility which has been arranged with a major Australian bank. Our subsidiary company manages the interest rate risk by:

• ensuring access to diverse sources of funding • an ongoing review or borrowing levels • having a limit imposed on the maximum borrowing amount allowed by council.

Investment of surplus funds is made with approved financial institutions under the Local Government Act 1989. We manage interest rate risk by adopting an investment policy that ensures:

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MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010

• appropriate liquidity • diversification by credit rating, financial institution and investment product • monitoring of return on investment • benchmarking of returns and comparison with budget.

Maturity will be staggered to provide for interest rate variations and to minimise interest rate risk. Credit risk

Credit risk is the risk that a contracting entity will not complete its obligations under a financial instrument and cause us to make a financial loss. We have exposure to credit risk on all financial assets included in our balance sheet. To help manage this risk:

• we have a policy for establishing credit limits for the entities we deal with • we may require collateral where appropriate • we only invest surplus funds with financial institutions which have a recognised credit rating specified in our investment policy.

Trade and other receivables consist of a large number of customers, spread across the consumer, business and government sectors. Credit risk associated with the council's financial assets is minimal because the main debtor is the Victorian Government and other councils. Apart from the Victorian Government and councils we do not have any significant credit risk exposure to a single customer or groups of customers. Ongoing credit evaluation is performed on the financial condition of our customers and, where appropriate, an allowance for doubtful debts is raised. The aging of receivables has been disclosed in Note 5.

We may also be subject to credit risk for transactions which are not included in the balance sheet, such as when we provide a guarantee for another party. Details of our contingent liabilities are disclosed in note 19. Liquidity risk

Liquidity risk includes the risk that, as a result of our operational liquidity requirements:

• we will not have sufficient funds to settle a transaction on the date • we will be forced to sell financial assets at a value which is less than what they are worth • we may be unable to settle or recover a financial assets at all.

To help reduce these risks we:

• have a liquidity policy which targets a minimum and average level of cash and cash equivalents to be maintained • have readily accessible standby facilities and other funding arrangements in place • have a liquidity portfolio structure that requires surplus funds to be invested within various bands of liquid instruments • monitor budget to actual performance on a regular basis • Council has no direct borrowings.

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MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010

The council’s exposure to liquidity risk is deemed insignificant given our high levels of cash and cash equivalents and nil borrowings and our current assessment of risk.

The table below lists the contractual maturities for financial liabilities. These amounts represent undiscounted gross payments including both principal and interest amounts

Consolidated 2010 6 mths 6-12 1-2 2-5 >5 Contracted Carrying or less months years years years Cash Flow Amount $'000 $'000 $'000 $'000 $'000 $'000 $'000 Trade and other payables 45,529 - - - - 45,529 45,529 Trust funds and deposits 2,458 1,500 2,500 3,822 - 10,279 10,279 Interest-bearing loans and - 1,000 - - - 1,000 1,000 borrowings Total financial liabilities 47,987 2,500 2,500 3,822 - 56,808 56,808

Consolidated 2009 6 mths 6-12 1-2 2-5 >5 Contracted Carrying or less months years years years Cash Flow Amount $'000 $'000 $'000 $'000 $'000 $'000 $'000 Trade and other payables 75,458 - - - - 75,458 75,458 Trust funds and deposits 847 1,000 1,500 4,349 - 7,696 7,696 Interest-bearing loans and - - 9,101 - - 9,101 9,101 borrowings Total financial liabilities 76,305 1,000 10,601 4,349 - 92,255 92,255

Council 2010 6 mths 6-12 1-2 2-5 >5 Contracted Carrying or less months years years years Cash Flow Amount $'000 $'000 $'000 $'000 $'000 $'000 $'000 Trade and other payables 27,641 - - - - 27,641 27,641 Trust funds and deposits 1,273 1,500 2,500 3,822 - 9,094 9,094 Interest-bearing loans and ------borrowings Total financial liabilities 28,914 1,500 2,500 3,822 - 36,735 36,735

Council 2009 6 mths 6-12 1-2 2-5 >5 Contracted Carrying or less months years years years Cash Flow Amount $'000 $'000 $'000 $'000 $'000 $'000 $'000 Trade and other payables 43,671 - - - - 43,671 43,671 Trust funds and deposits - 1,000 1,500 4,349 - 6,849 6,849 Interest-bearing loans and ------borrowings Total financial liabilities 43,671 1,000 1,500 4,349 - 50,520 50,520

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MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010

(f) Sensitivity disclosure analysis

At reporting date, if interest rates had been higher or (lower) by 1 per cent and all other variables held constant, council’s surplus would have increased or reduced by approximately $1.16 million ($1.0 million for 2009). This is mainly attributable to council’s exposure to interest rates on its investment portfolio.

The table below discloses the impact on net operating result and equity for each category of financial instruments held by the council at year-end, if the above movements were to occur.

Interest rate risk -2 % +1% -200 basis points +100 basis points Profit Equity Profit Equity 2010 $'000 $'000 $'000 $'000 $'000 Consolidated Financial Assets Cash and cash equivalents 129,769 (2,595) (2,595) 1,298 1,298 Financial liabilities: Interest-bearing loans and borrowings 1,000 (20) (20) 10 10

Council Financial Assets Cash and cash equivalents 117,565 (2,351) (2,351) 1,176 1,176

(g) Fair value hierarchy

The table below analyses financial instruments carried at fair value by valuation method.

The different levels have been defined as follows:

• Level 1 quoted prices (unadjusted) in active markets for identical assets or liabilities • Level 2 inputs other than quoted prices included within level one that are observable for the asset or liability, either directly, such as prices, or indirectly, such as those derived from prices • Level 3 inputs for the asset or liability that are not based on observable market data. Consolidated 30-Jun-10 level 1 level 2 level 3 total

Consolidated Available for sale financial assets 14,664 - - 14,664

Council Available for sale financial assets 14,664 - - 14,664

30-Jun-09 level 1 level 2 level 3 total

Consolidated Available for sale financial assets 14,275 - - 14,275

Council assets 14,275 - - 14,275

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MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010

Note 23. Financial ratios

Consolidated Council 2010 2009 2008 2010 2009 2008 (a) Debt Servicing Ratio Debt servicing cost 416 0.09% 0.15% 0.18% 0 0 0 0 Total revenue 452,732 341,009 To identify the capacity of the Council to service its outstanding debt. Council's ability to meet it's Debt servicing cost is extremely strong. When rounded the ratio of revenue to debt is less than 0.08%

(b) Debt Commitment Ratio Debt servicing and redemption costs 1000 0.55% 4.00% 0.48% 0 0 0 0 Rate revenue 180,670 180,670 To identify Council's debt redemption strategy. Council's ability to meet it's Debt commitment is extremely strong. When rounded the ratio of rate revenue to debt is less than 1.0%

(c) Revenue Ratio Rate revenue 180,670 40% 39% 37% 180,670 53% 52% 50% Total revenue 452,732 341,009 To identify Council's dependence on rates. (d) Debt Exposure Ratio Total indebtedness 100,533 3% 4% 4% 60,121 2% 3% 3% Total realisable assets 3,079,233 3,005,977 To identify Council's exposure to debt. * per cent of realisable assets is required to cover debt in 2010. (e) Working Capital Ratio Current assets 173,271 227% 209% 241% 146,436 294% 231% 283% Current liabilities 76,319 49,891 To assess Council's ability to meet current commitments. For every dollar of current liabilities, Council has $2.94 of current assets in 2010. 159

MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010

Definitions

To assess council's ability to meet current commitments. For every dollar of current liabilities, council has $2.94 of current assets as at 30 June 2010. Current assets Total current assets as shown in the balance sheet. Current liabilities Total current liabilities as shown in the balance sheet. Includes the principal component of repayments on loans and financial Debt redemption leases and capital items purchased on vendor terms. Includes interest and charges on loans, overdrafts and interest on Debt servicing costs payments for capital items purchased on vendor terms. Includes revenue from general rates, municipal charges, special rates, Rate revenue special charges, service rates and service charges. Total liabilities, both current and non-current, as shown in the Balance Total indebtedness Sheet. Total realisable assets Total current assets and total realisable non-current assets. Total revenue Total revenue as shown in the Income Statement.

Note 24. Events occurring after balance date

Nil.

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MELBOURNE CITY COUNCIL City of Melbourne 2009–2010 Annual Report Notes to the financial statements For the year ended 30 June 2010

STATEMENT BY COUNCILLORS, CHIEF EXECUTIVE AND PRINCIPAL ACCOUNTING OFFICER ON THE FINANCIAL REPORT

For the year ended 30 June 2010

In my opinion the accompanying financial report and standard statements have been prepared in accordance with the Local Government Act 1989, the Local Government (Finance and Reporting) Regulations 2004, Australian Accounting Standards and other mandatory professional reporting requirements.

Phu Nguyen (CPA)

Principal Accounting Officer

In our opinion the accompanying financial report presents fairly the financial transactions of the Melbourne City Council Group and the Melbourne City Council for the year ended 30 June 2010 and the financial position of the Melbourne City Council Group and Melbourne City Council as at that date.

As at the date of signing, we are not aware of any circumstance, which would render any particulars in the financial report to be misleading or inaccurate.

We were authorised by the council on 31 August 2010 to certify the financial report in its final form.

Robert Doyle Brian Shanahan

Lord Mayor Councillor

Kathy Alexander

Chief Executive Officer

Melbourne

31 August 2010

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AUDITOR-GENERAL’S REPORT ON THE FINANCIAL REPORT

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