LGIS considers that practices among local governments in Queensland to determine value for money and project viability are quite varied in robustness and in many instances non-existent. Small to medium-sized local governments in particular often lack in-house specialist or technical expertise to prepare an appropriate business case for proposed projects. LGIS has observed examples where decisions were made based on a technical design made to fit a budget, without a full understanding of the project need, feasibility, risks or costs. This can result in cost overruns due to scope and /or vision creep. LGIS has also observed examples where project scope is reduced or a portion of the project deferred due to actual costs being greater than the original project estimates (due to a lack of process) resulting in the project being significantly different than that originally proposed. The lack of robust and sound decision making practices as well as the lack of in-house capability increases the risk of poor project selection and sub-optimal outcomes, by exposing local governments to cost overruns, delays in delivery and issues regarding project fitness for purpose. A mechanism that channels projects through a robust and diligent process to demonstrate project value for money and community benefits (rather than meeting restrictive eligibility criteria) would provide benefit. LGIS was developed to address many of the issues outlined in this paper, and since 2005, we have worked with most small to medium-sized local governments on supporting and enhancing their in-house capabilities through the provision of project management frameworks, procurement advice and good governance practices. I would be pleased to provide further information to the Commission if needed. Sincerely John Curran Chief Executive Attachment A Pressure and Leakage Management Program In 2006, the Queensland Government and 10 local governments entered into an agreement with LGIS to deliver a regional water pressure and leakage management project. At the time, Queensland was in the grip of one of the worst droughts on record and the State
LGIS considers that practices among local governments in Queensland to determine value for money and project viability are quite varied in robustness and in many instances non-existent. Small to medium-sized local governments in particular often lack in-house specialist or technical expertise to prepare an appropriate business case for proposed projects. LGIS has observed examples where decisions were made based on a technical design made to fit a budget, without a full understanding of the project need, feasibility, risks or costs. This can result in cost overruns due to scope and /or vision creep. LGIS has also observed examples where project scope is reduced or a portion of the project deferred due to actual costs being greater than the original project estimates (due to a lack of process) resulting in the project being significantly different than that originally proposed. The lack of robust and sound decision making practices as well as the lack of in-house capability increases the risk of poor project selection and sub-optimal outcomes, by exposing local governments to cost overruns, delays in delivery and issues regarding project fitness for purpose. A mechanism that channels projects through a robust and diligent process to demonstrate project value for money and community benefits (rather than meeting restrictive eligibility criteria) would provide benefit. LGIS was developed to address many of the issues outlined in this paper, and since 2005, we have worked with most small to medium-sized local governments on supporting and enhancing their in-house capabilities through the provision of project management frameworks, procurement advice and good governance practices. I would be pleased to provide further information to the Commission if needed. Sincerely John Curran Chief Executive Attachment A Pressure and Leakage Management Program In 2006, the Queensland Government and 10 local governments entered into an agreement with LGIS to deliver a regional water pressure and leakage management project. At the time, Queensland was in the grip of one of the worst droughts on record and the State
subdr155-infrastructure.docx