A Brief History of New Zealand's National Asset Management


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A Brief History of New Zealand's National Asset Management

  1. 1. A Brief History of New Zealand’s National Asset Management Steering Committee Anthony Wilson General Manager Community Assets
  2. 2. Background <ul><li>NZ is a sovereign nation with a ‘Westminster’ style parliament. </li></ul><ul><li>2 tiers of government – central and local </li></ul><ul><li>Local Government is a creature of statute </li></ul><ul><li>Water Supply, Sewerage, Flood Control and Stormwater are the responsibility of local government (with some exceptions) </li></ul><ul><li>Size of local government units varies hugely: 500,000 popn to 1,800 popn. </li></ul><ul><li>National population 4,000,000. </li></ul>
  3. 3. 1989 Reform <ul><li>Units of local government significantly reduced </li></ul><ul><li>Local Govt required to be demonstrably ‘efficient’ and ‘effective’. </li></ul><ul><li>Moved from Cash Book to Accrual accounting </li></ul>
  4. 4. Specifically Local Govt had to: <ul><li>Establish clear objectives for each activity and measure its performance in relation to these objectives </li></ul><ul><li>Annually report to the public on stated targets and performance </li></ul><ul><li>Establish a fair valuation of the existing assets and make financial provision for maintaining and replacing the assets. </li></ul>
  5. 5. All 74 Councils had the same problem: <ul><li>Up to 140 years of asset creation </li></ul><ul><li>Poor records </li></ul><ul><li>No values for existing assets </li></ul><ul><li>Uncertainty on performance </li></ul><ul><li>Uncertainty on condition </li></ul><ul><li>Uncertainty of maintenance history </li></ul><ul><li>Uncertainty on service lives </li></ul>
  6. 6. <ul><li>Clearly if a co-operative solution could be found it would benefit all </li></ul><ul><li>Some models of commonality and co-operation existed </li></ul><ul><li>All Councils used RAMM (Roading Asset Maintenance Management) </li></ul><ul><li>Water Supply and Drainage Managers (Sub groups of NZWWA) had ‘project fund’ for common need projects </li></ul>
  7. 7. Examples: <ul><li>Model Bylaws (Ordinances) </li></ul><ul><ul><li>Trade Waste </li></ul></ul><ul><ul><li>Water Supply Conditions of Supply </li></ul></ul><ul><li>Standard specification for chemicals for water treatment </li></ul><ul><li>Model public information resource packs for water conservation </li></ul>
  8. 8. PAMS Project Pipeline Asset Management Software <ul><li>Water & Drainage Engineers recognised complexity of asset base needed a digital solution </li></ul><ul><li>7 leaders of the industry (from big, medium and small Councils) were invited to a meeting in December 1993. </li></ul><ul><li>Individuals were selected for their individual drive not the ‘status’ of their organisation. </li></ul>
  9. 9. Objectives Agreed: <ul><li>Select a software product that would be suitable to both largest and smallest </li></ul><ul><li>30 of 74 Councils take up seen as ‘critical mass’ to be regarded as ‘national’ system. </li></ul><ul><li>Good products did exist internationally </li></ul><ul><li>Any system may need customisation for NZ (e.g. metrication) </li></ul><ul><li>Needed a probity auditor for selection process </li></ul><ul><li>All Councils should be encouraged to contribute as all stood to benefit </li></ul>
  10. 10. <ul><li>Project needed to be managed by small team but all contributors needed to be kept routinely informed </li></ul><ul><li>Selected system needed to be flexible for single PC site to multi-user environment </li></ul><ul><li>Dynamic integration needed to GIS, financial, property and customer systems </li></ul><ul><li>Reporting from the system must be simple flexible and user friendly </li></ul><ul><li>Project provided basis for national database and benchmarking </li></ul><ul><li>Needed to recognise NZ’s outsourcing environment </li></ul>
  11. 11. <ul><li>Municipal Engineers Association (ALGENZ now INGENIUM asked to ‘sponsor’ project </li></ul><ul><li>Project cost $120,000 </li></ul><ul><li>Included: </li></ul><ul><ul><li>International literature review </li></ul></ul><ul><ul><li>Workshops to determine user requirements </li></ul></ul><ul><ul><li>Detailed specification </li></ul></ul><ul><ul><li>Peer review </li></ul></ul><ul><ul><li>International registrations of interest </li></ul></ul><ul><ul><li>Standard contract documents </li></ul></ul><ul><ul><li>Customisation of selected product </li></ul></ul><ul><ul><li>Acceptance testing </li></ul></ul><ul><ul><li>National roadshow to market product </li></ul></ul>
  12. 12. Cost to individual councils: <ul><li>Project Cost $120,000 </li></ul><ul><li>Largest Councils $2,000 </li></ul><ul><li>Medium Councils $1,000 </li></ul><ul><li>Small Councils $500 </li></ul><ul><li>In the end all but 2 of 74 Councils contributed to the project </li></ul>
  13. 13. Next projects <ul><li>A number of different organisations started to develop complementary projects: </li></ul><ul><li>Standardised Data Dictionary </li></ul><ul><li>Asset Numbering Guidelines </li></ul><ul><li>Condition Assessment Guidelines </li></ul><ul><li>Performance Assessment Guidelines </li></ul><ul><li>CCTV Inspection Grading Standards </li></ul><ul><li>National AC condition data collection </li></ul>
  14. 14. Need for National Co-ordination recognised - multi entity committee formed <ul><li>INGENIUM (municipal engineers) </li></ul><ul><li>New Zealand Water and Wastes Assn (equivalent to WEF and AWWA) </li></ul><ul><li>Society of Local Government Managers (accountants and administrators) </li></ul><ul><li>Local Government New Zealand (elected representatives organisation) </li></ul><ul><li>Officer of Controller and Auditor-General (Officer of Parliament) </li></ul>
  15. 15. NAMS Projects <ul><li>PRAMS Parks & Recreation Asset Management Software </li></ul><ul><li>National Asset Management Manual (based on Australian version. Now International Infrastructure Management Manual) </li></ul><ul><li>Asset Valuation and Depreciation Guidelines </li></ul><ul><li>Guidelines for Agreeing and Monitoring Service Levels with Customers </li></ul>
  16. 16. <ul><li>Optimised Decision Making Guidelines </li></ul><ul><li>‘ Tips for the New Car Owner’ – An elected representatives guide to Asset Management </li></ul><ul><li>RAMM enhancement </li></ul><ul><li>Standard reporting </li></ul><ul><li>On going training programme </li></ul><ul><ul><li>Sessions pitched at newcomer, intermediate and advanced levels </li></ul></ul><ul><ul><li>National roadshows </li></ul></ul><ul><ul><li>Customised to suit topical issues (legislation change etc.) </li></ul></ul>
  17. 17. Why was and has NAMS been successful? <ul><li>It was timely – everyone had a urgent need driven by legislation change. </li></ul><ul><li>We picked the right movers and shakers – individuals not organisations </li></ul><ul><li>It delivered unquestionably value for money -tangible outcomes not just theory </li></ul><ul><li>Financial contributions were project not subscription based. </li></ul><ul><li>Costs were set to be affordable for small entities. </li></ul><ul><li>We didn’t try and reinvent the wheel, we picked good international examples and improved them. </li></ul>
  18. 18. <ul><li>Communications was good and targeted at right people within organisations often at two or more levels in same organisation </li></ul><ul><li>Individual enthusiasts were encouraged to develop national expertise and status (e.g. asset numbering and asbestos cement pipes) </li></ul><ul><li>Training became the cash cow which provided seed capital to provide critical mass </li></ul><ul><li>We successfully engaged both local and national politicians </li></ul><ul><li>National roadshows </li></ul>
  19. 19. <ul><li>We had some champions in consultancies who identified projects and approached NAMS to progress them </li></ul><ul><li>A number of different individuals, organisations and disciplines became ‘evangelists’: accountants, engineers, administrators, elected representatives, auditors. NAMS provided a forum fro them. </li></ul><ul><li>Special Interest groups were encouraged to ‘do their own thing’ within a loose framework. (e.g software User Groups) </li></ul><ul><li>By having the Auditor-General ‘inside the house’ we jointly developed the rules. This has lead to ongoing legislation change being strongly influenced by the practitioners </li></ul>
  20. 20. What could we have done better in hindsight? <ul><li>We had a software solution but almost no data to use in it! </li></ul><ul><li>We raised some expectations too high </li></ul><ul><li>Maintaining the drive and consistency is challenging. These projects take years and people move both within and out of the industry </li></ul><ul><li>Some projects, notably the CCTV manual are overdue for updates. </li></ul><ul><li>Medium sized entities appear to manage change better than small or very large ones. </li></ul><ul><li>Don’t worry about freeloaders “Imitation is the greatest form of flattery” </li></ul>
  21. 21. NAMS today <ul><li>Industry based public and private sector interest representation </li></ul><ul><li>Fulltime CEO </li></ul><ul><li>Mechanical Engineer with sales background </li></ul><ul><li>Funded by products and services not subscriptions </li></ul><ul><li>Has relationships with similar organisations in Australia, Canada and South Africa. </li></ul><ul><li>Has marketing agreements with APWA, FHWA & AASHTO in USA (non exclusive) </li></ul><ul><li>2005 version of IIMM will have USA specific section and USA case studies (Sep/Oct 05) </li></ul><ul><li>Keen to develop new relationships </li></ul>
  22. 22. <ul><li>www.nams.org.nz </li></ul><ul><li>+64 7 868 3930 </li></ul>