By Edward Fraser

Local government performance and productivity worldwide could be improved by more than $10 billion by establishing a Global Local Government Standards and Performance Council focused specifically on that goal. This proposal is based on my experience and observations in Australia, where I have worked for 25 years.

In Australia, some states have shown leadership in performance measurement. Victoria, for example, recently legislated key performance indicators (KPIs), and the New South Wales Treasury Corporation has done some excellent work on productivity. At the council and shire level there also is great work occurring regarding historical local data that needs to be noted.

With further review and not too much effort, the results could be turned into some great national and global performance indicators.

Local government in Australia, however, has shown little interest in the development of agreed-upon national measures of efficiency and productivity for the local government sector. The only standout exception is the world-class work being done by the Institute of Public Works and Engineering Australasia, which has a model for local governments to report on their assets such as roads, buildings, fleets, and other infrastructure.

Sadly, due to a lack of public performance data, the public and those who govern and work in Australian councils and shires do not know if we are productive or efficient compared with others, as we don’t consistently measure or report nationally. And it seems this is a global opportunity.

Financial Savings

The financial benefits of an improved performance approach are significant. My personal review of performance indicators and benchmarks for my previous $30 million regional council was that it realized productivity improvements or savings of more than 4.5 percent by doing some relatively simple internal review, benchmarking, and performance work.

Taking less than half of this figure, or 2 percent, as a crude measure and extrapolating it to the $30 billion sector in Australia, we could generate at least $600 million per year in improved productivity by embracing and applying national (and as relevant, global) performance standards.

And if we apply an even more conservative 1 percent productivity improvement to the United States, the figure would be approximately $12 billion, based on the $1.2 trillion revenue “guesstimated” by usgovernmentrevenue.com.

The multibillion dollar question is how do we get local government leaders to embrace and buy into national and global performance information that can deliver significant savings that can be reinvested into their communities. Various bodies, including ICMA, are well placed to lead the discussion globally, which could, in turn, gain national attention and local commitment.

Unfortunately, in Australia, the elected members who often have a mandate of improving community value or ensuring savings, or boosting productivity are working against a system and culture that is not open to national benchmarks and national simple performance measures.

If every one of the 560 or so councils in Australia spent $10,000 on ensuring a focus on national performance data and reporting, we would have a $5.6 million budget that could generate sector savings 100 times that amount.

Benefits of a Global Effort

The creation of a Global Local Government Standards and Performance Council would further build on the efforts of ICMA and other national and state organizations. The council can encourage local governments to learn from each other, to reduce duplication, and to improve productivity as the result of greater sharing and use of templates, reports, policies, procedures, indicators, service measures, and documents.

Participants would benefit from:

• Improved knowledge of standards and performance criteria.
• Access to a performance model and associated support for initial self-assessment.
• Use of support materials, practical templates, and documents to support quality and productive practice.
• Opportunity to compare and benchmark results.
• Opportunity to participate in forums to exchange information and share innovations.
• Use of performance and key indicator data that is industry-led, tested, and used.

Moving Ahead

One Australian performance development in which I am proud to have played a role last year is the passage of a motion to develop Australian national standards for local government, which would include national performance indicators.

The motion was supported by attending mayors at the National General Assembly of the Australian Local Government Association. So the seed was planted and is just waiting for some more soil and water.

The idea also was presented at two national Australian forums run by the Local Government Managers Association and also at the ICMA International Regional Summit in China in 2014.

I propose that the best starting point is performance measures in the governance space, as well as financial, workload efficiency, and end-user satisfaction measures, which will be of no surprise to any agency that would be focused on these areas already.

One area where Australia and the U.S. local government sector are particularly well placed to take a leadership role is anticorruption. Both countries rank high and favourably on the anticorruption index developed by Transparency International.

Our good work in governance, procurement, transparency, and free media position us to lead global efforts to reduce corruption, which the World Bank Institute has estimated is the world’s third largest industry at more than $1 trillion per year1 (and from my research, double Apple revenue).

In addition to the global performance picture, I particularly welcome further interest and would be pleased to share progressive work on governance and anticorruption self-assessment tools and associated performance information that can help make a difference for all.