What is an annual business plan?
An annual business plan is a council’s statement of its intended programs and outcomes for the year. Required content is set out in Section 123 (2) of the Local Government Act 1999 and in the regulations. The document should include the following elements:
a summary of the Council’s longer term objectives, as set out in its strategic management plans;
significant influences for the year including financial factors, asset renewal needs and progress on continuing projects;
the Council’s specific objectives for the next year against which its performance will be measured;
the activities (services and projects) that the Council intends to undertake to achieve its objectives;
a summary of the proposed sources of revenue for the year;
the Council’s proposed approach to rating for the year and what it means for ratepayers.
Work done on Council’s strategic management plan and other management plans will help establish clear and consistent parameters for preparation of the annual business plan. This work provided strategic analysis and identified the Council’s vision for the area and longer term objectives. Development of long-term financial and asset management plans will establish year by year parameters for the Council’s operating surplus/deficit and its level of net financial liabilities. Council has commenced preparing its Asset and Infrastructure Management Plan (AIMP) which, once formulated, will be integrated into a 10 year financial plan.
How does the annual business plan relate to the budget?
The annual budget is a Council’s statement of:
its intended operating and capital expenditure as well as revenue sources to give effect to its annual business plan; and
its projected financial position.
Decisions in the annual business plan on matters such as project priorities and levels of service provision are subject to the funds available, as determined through the budget process and in the context of the Council’s long-term financial and asset management plans.
What is appropriate consultation?
The Act requires consultation on the draft annual business plan – it does not require consultation on the draft budget. This enables consultation to be undertaken at an earlier stage on Council priorities, funding and rating policies without having to wait until more detailed financial information is available towards the end of the financial year.
Consultation must be undertaken on the draft annual business plan in accordance with the Council’s adopted public consultation policy, the minimum requirements for which are set out in Section 123 (4) of the Local Government Act 1999.
The minimum consultation requirement comprises publication of a notice in the local press allowing at least 21 days for written submissions and/or verbal submissions at a public meeting. Councils are also required to make a provision for submissions to be made electronically via the Councils web site. The public meeting may form part of a meeting of the Council. Section 123 (5) requires that copies of the draft annual business plan must be available at the meeting and for at least twenty one days before the meeting. All submissions received must be considered by the Council in finalising the annual business plan. Council has opted to hold a public meeting on 17 May 2012 for members of the community to address Council on the proposed annual business plan.
This minimum requirement is quite specific, and focuses on the completed draft annual business plan document. Unless there are controversial elements of major community concern, it is unlikely that the consultation will generate a high level of community response.
Those councils that prepare a combined draft annual business plan and budget document can choose to consult on the whole document, although the consultation draft need not include the full financial detail to be finalised in completing the budget.
To promote wider community engagement, each council is encouraged to undertake whatever additional consultation it considers appropriate, in accordance with its public consultation policy. Council has undertaken preliminary consultation focused on community priorities for services and projects. (i.e. seeking budget submissions from community groups prior to commencing the formation of the annual business plan).
The Chief Executive Officer along with Senior Staff consider that Council already has a close enough engagement with its community to be able to prepare the draft annual business plan with a reliable awareness of community priorities, without requiring further consultation beyond the statutory requirement. Council is informed of community meetings of many organisations and minutes are forwarded to Council for their information and consideration.
When should the annual business plan be prepared?
Section 123 (7) of the Act requires that a council must consider its budget in conjunction with its annual business plan, and that the annual business plan must be adopted before the annual budget is adopted. Section 123 (8) requires that the annual business plan and the budget must be adopted after 31 May and before 31 August for the ensuing financial year.
In practice all councils should aim to have their annual business plans adopted before the end of June. Councils should also aim to adopt budgets by the end of June however the timing of this may be dictated by the timing of receipt of property valuation data. Any delay beyond the end of June for the adoption of budgets may reduce revenues from increased charges and shorten the period available for delivery of programs as well as possibly putting back receipt of rate revenue.
Initial Council consideration of the annual business plan generally should commence no later than February to allow time for finalisation of the draft for consultation around April/May and final adoption in June.
How should the annual business plan be published?
Section 123 (9) of the Act requires that a Council must prepare a summary of the annual business plan to be sent out with the first rates notice for the year. Subsection (11) requires that this must include “an assessment of the extent to which the council’s objectives for the previous financial year have been attained (taking into account the provisions of the annual business plan for that financial year)”.
Copies of the annual business plan and annual budget documents and the annual business plan summary must be made available to the public from the Council office. Although not specified in the legislation, councils would also normally make copies available for downloading from their website.
The requirement to send out an annual business plan summary with the first rates notice will be most easily met if the summary version has already been prepared at the time of consultation with residents and ratepayers on the draft annual business plan. A clearly expressed and presented summary, highlighting the key issues relevant to ratepayers should assist this communication and consultation process.
Council’s 2012/13 Annual Business Plan
Introduction
The annual business plan sets out the Council’s proposed services, programs and projects for 2012-13. It aims to maintain efficient services for the community and continue progress towards the longer term objectives for the District Council of Cleve set out in the strategic management plan adopted by the Council on 12 November 2008 (and updated annually since).
The District Council of Cleve has a population of approximately 1900 people with approximately 750 residents in the township of Cleve and 250 residents in the township of Arno Bay.
The District Council of Cleve covers an area of 480,343 square kilometers and shares boundaries with Kimba, Franklin Harbour, Elliston and Tumby Bay Councils.
The Cleve district is a major contributor to South Australia’s cereal crops with significant cropping of wheat, barley and canola as well as livestock production.
The area has seen the emergence of the aquaculture industry with the cultivation of Yellowtail Kingfish, Mulloway and more recently Southern Bluefin Tuna at CleanSeas’ land based hatchery situated at Arno Bay.
In recent times the district has experienced a growing interest in economic activity with a particular focus on developing the tourism, aquaculture and mining industry.
An increase in tourism is something the Council has been focusing on by conducting a staged implementation of the recommendations from the District Tourism Strategic Plan developed and adopted in 2008, which remains ongoing. The region offers some unique tourism attractions which to date have not been promoted to their full potential. The district offers both coastal beach front as well as rural farming land encompassing panoramic scenic drives and beautiful, largely undeveloped conservation parks. The district is also home to the highest granite rock mass on Eyre Peninsula, at Carappee Hill.
As part of Council’s budget process it has attempted to engage the community. Council will continually engage the residents andratepayers through this process. Council has attempted to refine its budget and business planning process further in an effort to better engage the community.
Community engagement is a high priority for councils as they come to grips with balancing increasing demands and services with limited resources. The District Council of Cleve is working on how it provides the right amount of information, how it effectively consults and what level of involvement and collaboration is provided to the community. The benefits of Council undertaking improved community engagement processes have spin offs in community trust and better connections with the community.
Many difficult issues continue to be faced by Council with cost shifting from other spheres of Government and pressure to comply with guidelines such as the Environment Protection Authority Waste Management guidelines. This places ongoing financial pressure on the ratepayers of the district as Council tries to find the balance between compliance and community expectation.
Our Future
The Council is currently reviewing its strategic plan for the period 2012/13 – 2015/16. This draft annual business plan has been developed in line with both the existing and proposed strategic objectives of Council. For simplification purposes, the remainder of this document will refer to the current adopted strategic plan which was first adopted in November 2008 and has been reviewed annually. Implementation of objectives within Councils Strategic Plan is reported in Council’s Annual Report.
Council’s vision is to promote a progressive community, building on our strengths for future generations.
Its mission is to provide a high standard of services and infrastructure within our community to sustain and improve the quality of life.
Its core values are:-
Strategic
Leadership
Stability
Community Services
Teamwork
Continuous Improvement
The Goals set by Council are:-
1.Enhance the quality of life for members of our community.
2.Facilitate employment, economic prosperity and sustainable growth of our district.
3.Manage the natural and built environment with the aim of attaining a sustainable future.
4.Provide and manage infrastructure that meets the needs of our community that can be sustained with Council resources.
5.Provide progressive leadership and accountable governance to our community.
Each Goal has a number of objectives:-
1. Enhance the quality of life for members of our community
1.1Maximise the provision of health services to the community
1.2Meet the sporting and recreational needs of the community
1.3Obtain additional funding for the provision of community services
1.4Work in partnership with other community service providers
1.5Ensure the provision of appropriate aged care facilities and services
1.6 Improve opportunities for the retention and development of our Youth
2. Facilitate employment, economic prosperity and sustainable growth of our district.
2.1Capitalise on the tourism potential of our area
2.2Ensure the availability of appropriate accommodation facilities for potential and existing residents
2.3 Assist in the provision of high quality education and training facilities and services
2.4Support the development and expansion of the fishing and aquaculture industries
2.5Promote the establishment and expansion of local businesses
2.6Foster relationships with appropriate public and private sector organisations
2.7Promote Arno Bay as a major aquaculture centre for the expansion of fin fish hatchery and offshore aquaculture grow facilities
2.8Advocate on behalf of our local business sector at all levels of Government
2.9Promote the development of the local retirement industry
2.10Increase value adding and diversification in the agricultural industry
2.11Facilitate the further development of the mining industry on Eyre Peninsula
2.12Ensure adequate land is available to promote economic growth in the district
3. Manage the natural and built environment with the aim of attaining a sustainable future.
3.1Ensure the effective use of town stormwater
3.2Identify and implement high quality waste management techniques
3.3Establish, promote and implement plans, policies and strategies for environmental management
3.4Work with local, regional and State environmental organisations for the benefit of the community
3.5Ensure the standard of Council’s parks and gardens are maintained
3.6Protect and promote our local heritage
3.7Effectively develop and manage our foreshore areas
3.8Continue to develop our main streets and town entranceways
3.9Assess the potential impacts of climate change in relation to the environment, economy and community
4. Provide and manage infrastructure that meets the needs of our community that can be sustained with Council’s resources.
4.1Maximise the standards of our roads and footpaths
4.2Expand and maintain the Community Wastewater Management Scheme (CWMS) in the Council area
4.3Maintain and develop all Council owned buildings
4.4Maximise the return from our plant and equipment
4.5Ensure the provision of adequate levels of infrastructure for power, water and telecommunications
4.6Continue to implement best practice asset management techniques
4.7Advocate for improved infrastructure relevant to the needs of the business sector
5. Provide progressive leadership and accountable governance to our community .
5.1Encourage the professional and personal development of staff and elected members
5.2 Promote Occupational Health, Safety, Welfare and Risk Management as important components of everyday Council business
5.3 Improve communication between Council and the community
5.4Support and encourage the efforts of volunteers and increase volunteer involvement
5.5Promote a joint approach to opportunities and mutual collaboration between neighbouring councils
5.6Deliver all Council services in an effective and planned manner
This addresses the requirement of Section 123 (2) (a) of the Local Government Act 1999 to include a summary of the Council’s long-term objectives, as set out in its strategic management plans.
Significant Influences and Priorities
A number of significant factors have influenced the preparation of the Council’s 2012-13 annual business plans. These include:
Local Government Cost Index increases on relevant goods and services of 4.4% for the year ending December 2011;
The Consumer Price Index (CPI) Adelaide All Groups increase of 2.5% for the year ending December 2011.
Enterprise bargaining agreements and contracts which provide for wages and salary increases of approximately 4% for administrative and operational staff;
Service and infrastructure needs for a changing population;
Continued high cost of fuels;
Effect of compliance with EPA Waste Disposal Guidelines;
Requirements to maintain and improve infrastructure assets to acceptable standards including roads, footpaths, lighting, storm water drainage, street trees and plantings, open space and Council properties;
The following key budget principals were applied in the formation of the 2012-2013 Annual Business Plan
No reduction in services provided;
Any changes to the budget objectives are based on corporate objectives or due to legislative change;
Fees and charges are moving towards full cost recovery/user pays where possible taking into account the community’s capacity to pay;
Net rate income increase of 6% including natural growth taking into consideration the current economic climate
In response to these factors, and to minimise the burden on ratepayers, the annual business plan has been prepared within the following guidelines:
the annual business plan will result in the total revenue raised through general rates increasing by 6%;
an operating deficit budget before capital revenues
The Council’s priorities for 2012 – 2013 are:-
Extensive capital works on Council’s road network (Objective 4.01.01)
Ensure adequate land is available to promote economic growth in the district (Objectives 2.12.01 to 2.12.03)
Support development of the fishing industry (Objective 2.04.01)
Develop Council’s district tourism potential (Objectives 2.01.06, 2.01.08 & 2.01.11)
Whilst the above are not singularly identified within the budget, costs are absorbed within and across other budget functional areas mainly associated with the administration and governance of Council. A significant amount of Executive time will be spent on these high priorities.
This identifies key factors impacting on planning for the 2012-13 year, including additional costs to be absorbed, and the approach taken by the Council to manage these factors.
Continuing Services
All councils have basic responsibilities under the Local Government Act and other relevant legislation. These include: -
regulatory activities e.g. maintaining the voters roll and supporting the elected Council;