Asset Management – Necessary, but is it sufficient?

In case you haven’t caught up with it yet, ALGA’s ‘2024 National State of the Assets Report: future proofing our communities’ was released a week ago.  You can download a copy of the Summary and Technical reports here:

Sometimes reviewing a report is a chore. This was a pleasure. It ticked all the boxes: it was very readable; honed in on the important issues and provided useful, verified data.  It would be impossible for anyone to read this report and not gain a great appreciation for the pressures being faced by all councils, but especially smaller and regional councils, as they face the combined effect of asset ageing, climate change, increasing consumer expectations and more stringent regulations – and very little access to funding.

My overwhelming reaction, and it may be yours too, was to realise that better asset management is unlikely, by itself, to be sufficient. And this may be the most important take away. Asset Management is often presented as a panacea, it is not – but it is where we must start, for if we cannot manage effectively what we already have, how can we ask for more?

The good news is that this ALGA report indicates improvements are being made.   How we express data has a major effect on how it is received. I particularly appreciated having infrastructure costs expressed per ratepayer.  There was a time when we felt that large aggegate numbers had more impact and everybody tried to make their future costs as big as possible ‘to be impressive’, but expressing costs on a small personal scale, i.e. per ratepayer, enables greater understanding.  We are more able to feel it.  I also like the way that averages were dealt with. When I started work on life cycle renewal costs, realising that averages concealed more than they revealed, I put a lot of effort into calculating full age distributions.  But ALGA has realised we don’t need to do all that work if we supplement the average with an indication of the extent of the most urgent of renewals. Very sensible.  Indeed the entire report is very sensible.  There is a lot of data, but it is carefully designed not to overwhelm. 

It is a useful base for arguing for change. Change in the way we fund councils, change in the way we record and use depreciation figures are the first two that come to mind.  What else would you like to see changed?