Queensland’s state and local governments make significant investments in the public infrastructure they need to deliver public services.
This investment—in our electricity network, roads, rail and ports, and water and sewerage networks—is currently worth around $215 billion. We see strategic asset management as critical to supporting long-term operational and financial sustainability. Knowing when to renew and build new assets, and doing so in the most cost effective manner, will support the long-term sustainability of the state.
What should you consider when managing your assets?
Entities use assets to deliver services to the community. It is integral that state and local governments understand the community’s long-term needs, and what assets they will require to meet those needs. An asset management plan is one tool that entities can use to ensure community assets align with community priorities and expectations, in a financially sustainable manner.
Effective asset management plans drive an entity’s operations and asset investment decisions; they are not a compliance exercise to be filed and forgotten. Asset management plans may range from short documents prepared by employees with appropriate experience and expertise, to more complex documents prepared with the assistance of experts.
To be effective, asset management planning must balance the interrelationship between:
- the performance required from assets to meet current and future demand
- the level of risk that is acceptable to those charged with governance and key stakeholders
- the cost of and funding available for maintenance and renewal works.
What are the features of a good asset management plan?
An asset management plan should be integrated with other strategic and operational plans and risk management practices. It should cover the following points.
The plan should assess the current performance of physical and technology assets against criteria relevant to the entity’s service delivery. This may include condition, functionality, appearance, reliability, energy and water efficiency, and safety.
The plan should identify the future performance that the entity requires from an asset. This should consider changes in demographics, community expectations, and technological advancements.
Options to achieve the required level of performance
Clearly understanding asset performance, and analysing options to achieve the required level of performance, will allow entities to plan where and when to repair, replace or demolish assets. This should ensure existing assets continue to be fit for purpose, and that changing performance requirements are addressed, before existing assets become underused or redundant.
Costs and available funding options
Entities should quantify the whole-of-asset life cycle costs for existing and proposed assets, available funding options, and any budget shortfall.
Performance measures and targets
Entities should set performance measures and targets relevant to the risks and strategies identified during the asset management planning process. These should enable management to monitor progress towards achieving the required level of asset performance, over the short and long term. Lead indicators should also be considered to identify emerging risks. For example, changes in unplanned maintenance expenses or periods where assets are unavailable.