As introduced in my previous blog post the Local Government Amendment Act 2014 has become law.
The Amendment Act introduces a new Section 17A to the Local Government Act – Delivery of Services
The text of the Act is replicated below:
” Clause 1A of new Schedule 1AA 1A Transitional provisions relating to delivery of services
Waugh Infrastructure Management Commentary on Section 17A
Delivery of Services Section 17A requires that a local authority must review the cost-effectiveness of current arrangements for meeting the needs of communities within its district or region for good-quality local infrastructure, local public services, and performance of regulatory functions.
Section 17A has a number of triggers that apply to the application of the Section:
- Significant change in service levels
- Within two years of the completion of a relevant contract (before renewal of contract)
- At Councils discretion with a maximum time between reviews of six years
- The first review is required within three years (clause 1A of new Schedule 1AA)
Exceptions for review are:
- Circumstances where the services cannot be reasonably altered within the two years
- The local authority is satisfied that the potential benefits of undertaking the review do not justify the costs of undertaking the review
The delivery of services review has a number of specified requirements summarised below.
If the services are delivered by a different entity to the local authority further requirements are specified (these have not been summarised here).
- Must consider options for
- Options for the responsibility for governance, funding and delivery is exercised by
- The local authority
- A Council controlled organisation of the local authority
- A Council controlled organisation where the local authority is one of several shareholders
- Another local authority
- Another person or agency
The delivery of services reviews will be a major undertaking for Councils and will need to be thorough to meet the requirements specified in the Local Government Act.
The key driver of the delivery of services review is the cost-effectiveness of service delivery arrangements.
With regard to timing to complete these reviews, we suggest that this be well planned and that you review your contract renewals to determine when that trigger will be activated.
If you are not planning to complete the delivery of services review before the 2015 LTP is completed, then the proposed timing of the review should be noted in the AMPs or LTP along with commentary regarding the contract renewal trigger.
Assumptions you have made regarding the delivery of services review should also be noted in your Asset Management Plans.
PHOTO CREDIT: Wakefield Chambers Whanganui by Ross Waugh