National context - the converging forces on council assets 

Local governments own and manage a huge portfolio of community infrastructure and asset classes worth over $500 billion ranging from roads and footpaths, libraries, parks, airports, drainage, through to sporting fields and sometimes critical water and sewerage assets. 

All these assets are fundamental to daily life and supporting a regions economic activity, yet maintaining them is an enormous and growing task. ReadyTech works daily with Councils all over Australia, and we have observed several key drivers behind the current asset crunch including; 

• Ageing Infrastructure & Renewal Backlogs 

A high percentage of local infrastructure was built in the mid century and is reaching the end of it’s design life. Decades of tight budgets (councils collect only about 3% – 4% of the national tax revenue) has contributed to deferral of renewal works. The end result being a growing backlog.  

Queensland’s Auditor-General (2023) reported that many councils were spending less on asset renewal than depreciation, meaning assets are deteriorating faster than they are being replaced. These financial strains are much more acute for rural councils with their limited rate bases, forcing some to face the decision of reducing services or closing facilities through lack of affordability in completing upgrades. 

• Higher Community Expectations 

No surprise that with cost-of-living expenses, and rates being a portion of that, residents and businesses expect safe, reliable infrastructure. In the age of social media, any infrastructure failure can make the news and put pressure on a Council to act quickly. 

• Climate Change and Resilience 

Severe weather events seem to affect some part of Australia almost every week, testing local infrastructure like never before. Councils are needing to factor in greater resilience in various ways, by either relocating assets out of high risk areas, upgrading stormwater drains for more intense rain events or reinforcing against cyclones. 

All of these adaptions come at a cost with the ALGA forecasting a $2 billion + spend over the net five years to future proof community infrastructure, straining already tight capital works programs.Essentially Councils are being asked to build assets stronger and faster than their finances allow. 

Climate impacts also are having a compounding effect on the renewal backlog. An example being the 2022 Queensland floods damaging hundreds of local bridges and roads, instantly adding to many towns repair tasks. 

• Regulatory and Legislative Reforms 

It seems that every 3 to 5 years, every state introduces reforms that raise the bar for council governance, planning and asset oversight. Most of these changes are in response to high profile council financial collapses or community concerns around mismanagement. 

A lot of the recent reforms demand more rigorous (i.e. defensible) long term asset management planning, more frequent asset valuations and independent auditing. All excellent outcomes, but these improvements around accountability also pressure councils to meet higher standards quickly. An example, new laws in several states now require council to have 10 year asset management plans (linked to financial plans) and to report annually on asset renewal ratios and backlogs. This is going to make any shortcomings very visible.  To achieve this, many councils have had to upgrade their asset management practices and systems to comply, diverting effort into planning and data collection. Again, this is all adding to the immediate workload in front of Council staff. 

• Technology and Skills Constraints 

On one hand, new technology (drones, sensors, advanced asset management software) is helping council manage and inspect assets more efficiently. On the other hand, there is a skills crunch with council suffering a shortage of asset engineers, GIS specialists and data analysts – all skills that are in short supply 

Larger councils might not be feeling this too strongly right now, and can invest in dedicated teams and new technology & systems, but smaller councils are struggling right now.  This widening of the capability gap is the key problem, with rural shires sometimes having only one person juggling multiple roles. This capability constraint increases the risk of inconsistent asset data and below par maintenance. 

As a results, we have seen efforts to share resources, for example, regional collaborations where an engineer or drone team services multiple councils. Technology innovation is a key part of the solution, but it requires investment and strategic thinking.

Council led initiatives 

All around Australia, Councils are actively responding to the issues and pressures described in this article.  Below are examples of Council responses in place and underway; 

• City of Melbourne (VIC) 

Using drones to inspect bridges, roads and public buildings. This approach is providing high-resolution imagery for maintenance planning, reducing the need for manual inspections, and improving safety and efficiency. 

•  Townsville City Council (QLD) 

Implemented a smart water infrastructure monitoring system to predict pipe failures. This predictive maintenance model is helping to prioritise repairs and reduce service disruptions. 

• Far North Queensland Regional Organisation of Councils (QLD) 

Jointly procured an asset management system and hired a roving asset engineer to support smaller councils post-cyclone. This shared approach is saving budget and improving data consistency. 

• Brighton Council (TAS) 

Developed its own asset management software and commercialised it. 

• Lockyer Valley Regional Council (QLD) 

Engaged in the Voluntary Home Buy-Back programme following the 2022 floods, reducing exposure to future flood risk and integrating resilience into infrastructure planning. 

• Moyne Shire Council (VIC) 

Amended planning schemes in Port Fairy to prevent development in areas at risk from sea level rise, embedding long-term climate risk into asset and land-use decisions. 

• City of Onkaparinga (SA) 

Conducted a climate change risk assessment to identify gaps in governance and service delivery. This led to a Climate Change Response Plan that now informs asset management and operational decisions. 

• City of Cockburn (WA) 

Expanded the CY O’Connor Artificial Reef to reduce coastal erosion and wave energy, protecting shoreline infrastructure and demonstrating innovative use of natural infrastructure. 

• City of Darwin (NT) 

Launched the Greening Darwin Strategy to increase tree canopy coverage in heat-vulnerable areas, protecting public infrastructure and improving liveability. 

• Rural City of Murray Bridge (SA) 

Reallocated budget to capital renewal after community consultation, improving its asset sustainability ratio from 60% to nearly 100% over three years. 

• City of Greater Geelong (VIC) 

Engaged residents through a deliberative panel to set infrastructure priorities, ensuring alignment between community expectations and long-term asset planning. 

What does this mean?  

Councils really are in a complex, inter-related asset crunch situation. The cross over of drivers such as financial reality, public expectation, environmental urgency, technical challenges and governance reformare all tightly integrated.  Not one is independent of the other. As an example, a major flood (climate driver) might expose poor road maintenance (financial / skills driver), which impacts the community (expectation driver) and then leads the state to step in (regulatory driver). 

All these headwinds mean that despite progress made, the path forward will not be easy for many Councils. These problems won’t be solved by a single budget or single reform but will require sustained effort over decades. Keeping up momentum will be challenging. However the direction is set, Councils are evolving to become more professional, collaborative and future focused in managing community assetsand ensuring their place as the most trusted level of government.