Under the Local Government Act 2009, local governments are required to adopt and implement a corporate plan. The programs under their control will have either a functional or a service orientation, and councils must have a corporate structure appropriate to the conduct of their affairs.

Councils also are required to adopt an operational plan and a budget which reflects, and is consistent with, the objectives of the corporate plan. The corporate plan also reflects the direction of the community plan (see module 6).

Corporate planning helps a council to understand its present situation, to examine how current and future trends may affect it and to decide how best to manage anticipated challenges. Corporate planning identifies where a council wants to be in the future and provides information about how it will get there based on available resources.

Corporate plans enable councils to further inform and negotiate with stakeholders and the community to ensure the community consultation process is open and transparent.

Planning is a vital component of sustainability. The corporate plan is embedded within the financial management, planning and accountability documents of council.

Introduction

The Act requires councils to undertake long-term community planning, asset management planning and financial forecasting.

These requirements help councils plan for the future needs of their communities and help determine their own financial sustainability. Long-term sustainability is not just about building the infrastructure that is needed today - it’s also about local governments having the capacity to maintain the levels of service required by a community into the future.

Sustainable local government planning

The Act introduces criteria for financial sustainability of councils and a focus on longer-term integrated planning with higher levels of accountability and transparency. Local governments will plan for current and future service delivery and infrastructure through longer-term planning. This will be achieved by developing 10-year financial forecasts and community, asset and infrastructure plans. The Act (s104) outlines the management, planning and accountability documents that councils are required to prepare.

A local government is financially sustainable if it is able to maintain its financial capital and infrastructure capital over the long-term. A council is sustainable if it:

• has long-term asset management plans
• has linked these plans to its long-term financial forecasts
• has managed financial implications in the long-term.

The Local Government (Finance, Plans and Reporting) Regulation 2010 (the Regulation) provides details of the requirements for financial management, planning (for example, community planning) and accountability for local governments, including documents, policies, records, reports and financial accounts.

The Sustainable Planning Act 2009 (SPA) also took effect in December 2009. The SPA is outcome-focused and significantly improves and streamlines the land use planning and development framework and systems.

It has reduced costs and allowed developments to be approved in a shorter timeframe by utilizing streamlined plan making, development assessment and partnerships.

This legislation seeks to achieve ecological sustainability in three ways:

• by managing the process by which development takes place
• by managing the effects of development on the environment
• by continuing the coordination and integration of local, regional and state planning.

Community planning

Under the Act, councils are required to prepare a long-term community plan and to report annually on the implementation of the plan. The community plan represents the community’s views, visions and values for the future of the local government area. It is the primary tool to guide council’s corporate plan, long-term financial forecast and long-term asset management plan.

The specific details of the plan and the method of community engagement are decided by individual councils. However, some direction is provided in the Regulation, including:

• a five-step process for developing a community plan, including intelligence- gathering, community input, community vision, validation, policy and adoption
• how a community plan can be adopted or changed
• the contents of a community plan, including economics, environmental management, governance and social well-being.

Long-term financial forecast

Under the Act (s104) Councils must prepare a 10-year financial forecast outlining the goals, strategies and policies for managing their finances.

The forecast must include the following:

• Investment policy covering objectives, risk philosophy and strategy, as well as procedures for implementing and complying with the policy.
• Debt policy outlining planned borrowings for five years, the purpose of such borrowings and repayment details.
• Procurement policy including the principles for purchasing goods and services.
• Revenue policy outlining the approach to levying rates and concessions and recovering overdue rates.
• A statement of financial position each year.

Asset management plan

The Regulation (s135-136) outlines the requirement for Councils to prepare a 10-year asset management plan outlining policies and strategies for ensuring the sustainable management of assets and infrastructure. The plan must detail how assets will be managed, improved and maintained over the long-term. The asset management plan must be integrated with the long-term financial forecast.

Corporate plan

A council’s corporate plan details how it will implement its community plan. The Regulation (s120-121) outlines the requirements for, and content of, council five-year corporate plans. The corporate plan must:

• describe the engagement process used to prepare the plan
• outline council’s strategic direction
• identify performance indicators for measuring council’s progress in achieving its vision for the future as stated in its community plan
• state how the community plan will be implemented.

Annual budget

Councils are required to adopt an annual budget (s98-101 of the Regulation) for the coming financial year. The budget identifies how a council will spend the money it receives from rates and other sources of revenue during the year. The annual budget is to be adopted after 31 May and prior to 1 September of each financial year. The budget must be consistent with the following documents of the local government:

• long-term financial forecast
• financial plan
• five-year corporate plan
• annual operational plan
• long-term community plan.

Annual report

The Act (s104), requires councils to prepare a series of financial management documents and an essential component of these financial management documents is the annual report.

It allows local governments to report on performance and provides the community with the opportunity to assess performance against goals in the council’s community plan, corporate plan and operational plan. A council’s annual report provides a comprehensive account of action taken in relation to, and expenditure on, services facilities and activities undertaken in the previous financial year (the Regulation s108-119).

The Queensland Audit Office

The Queensland Audit Office (QAO) supports the role of the Auditor-General and reports to the Parliament, enhancing public sector accountability. The Auditor-General is responsible for the annual audits of all local governments in Queensland.

Further information

For further information in relation to community and corporate planning for local government, refer to:

• Local Government Act 2009
• Planning for the future
• Queensland Audit Office.

Legislation extract