A Brief History of New Zealand’s National Asset Management Steering Committee

1. A Brief History of New Zealand’s National Asset Management Steering Committee Anthony Wilson General Manager Community Assets

2. Background • NZ is a sovereign nation with a ‘Westminster’ style parliament. • 2 tiers of government – central and local • Local Government is a creature of statute • Water Supply, Sewerage, Flood Control and Stormwater are the responsibility of local government (with some exceptions) • Size of local government units varies hugely: 500,000 popn to 1,800 popn. • National population 4,000,000.

3. 1989 Reform • Units of local government significantly reduced • Local Govt required to be demonstrably ‘efficient’ and ‘effective’. • Moved from Cash Book to Accrual accounting

4. Specifically Local Govt had to: • Establish clear objectives for each activity and measure its performance in relation to these objectives • Annually report to the public on stated targets and performance • Establish a fair valuation of the existing assets and make financial provision for maintaining and replacing the assets.

5. All 74 Councils had the same problem: • Up to 140 years of asset creation • Poor records • No values for existing assets • Uncertainty on performance • Uncertainty on condition • Uncertainty of maintenance history • Uncertainty on service lives

6. Clearly if a co-operative solution could be found it would benefit all • Some models of commonality and co-operation existed • All Councils used RAMM (Roading Asset Maintenance Management) • Water Supply and Drainage Managers (Sub groups of NZWWA) had ‘project fund’ for common need projects

7. Examples: • Model Bylaws (Ordinances) • Trade Waste • Water Supply Conditions of Supply • Standard specification for chemicals for water treatment • Model public information resource packs for water conservation

8. PAMS Project Pipeline Asset Management Software • Water & Drainage Engineers recognised complexity of asset base needed a digital solution • 7 leaders of the industry (from big, medium and small Councils) were invited to a meeting in December 1993. • Individuals were selected for their individual drive not the ‘status’ of their organisation.

9. Objectives Agreed: • Select a software product that would be suitable to both largest and smallest • 30 of 74 Councils take up seen as ‘critical mass’ to be regarded as ‘national’ system. • Good products did exist internationally • Any system may need customisation for NZ (e.g. metrication) • Needed a probity auditor for selection process • All Councils should be encouraged to contribute as all stood to benefit

10. Project needed to be managed by small team but all contributors needed to be kept routinely informed • Selected system needed to be flexible for single PC site to multi-user environment • Dynamic integration needed to GIS, financial, property and customer systems • Reporting from the system must be simple flexible and user friendly • Project provided basis for national database and benchmarking • Needed to recognise NZ’s outsourcing environment

11. Municipal Engineers Association (ALGENZ now INGENIUM asked to ‘sponsor’ project • Project cost $120,000 • Included: • International literature review • Workshops to determine user requirements • Detailed specification • Peer review • International registrations of interest • Standard contract documents • Customisation of selected product • Acceptance testing • National roadshow to market product

12. Cost to individual councils: • Project Cost $120,000 • Largest Councils $2,000 • Medium Councils $1,000 • Small Councils $500 • In the end all but 2 of 74 Councils contributed to the project

13. Next projects A number of different organisations started to develop complementary projects: • Standardised Data Dictionary • Asset Numbering Guidelines • Condition Assessment Guidelines • Performance Assessment Guidelines • CCTV Inspection Grading Standards • National AC condition data collection

14. Need for National Co-ordination recognised - multi entity committee formed • INGENIUM (municipal engineers) • New Zealand Water and Wastes Assn (equivalent to WEF and AWWA) • Society of Local Government Managers (accountants and administrators) • Local Government New Zealand (elected representatives organisation) • Officer of Controller and Auditor-General (Officer of Parliament)

15. NAMS Projects • PRAMS Parks &Recreation Asset Management Software • National Asset Management Manual (based on Australian version. Now International Infrastructure Management Manual) • Asset Valuation and Depreciation Guidelines • Guidelines for Agreeing and Monitoring Service Levels with Customers

16. Optimised Decision Making Guidelines • ‘Tips for the New Car Owner’ – An elected representatives guide to Asset Management • RAMM enhancement • Standard reporting • On going training programme • Sessions pitched at newcomer, intermediate and advanced levels • National roadshows • Customised to suit topical issues (legislation change etc.)

17. Why was and has NAMS been successful? • It was timely – everyone had a urgent need driven by legislation change. • We picked the right movers and shakers – individuals not organisations • It delivered unquestionably value for money -tangible outcomes not just theory • Financial contributions were project not subscription based. • Costs were set to be affordable for small entities. • We didn’t try and reinvent the wheel, we picked good international examples and improved them.

18. Communications was good and targeted at right people within organisations often at two or more levels in same organisation • Individual enthusiasts were encouraged to develop national expertise and status (e.g. asset numbering and asbestos cement pipes) • Training became the cash cow which provided seed capital to provide critical mass • We successfully engaged both local and national politicians • National roadshows

19. We had some champions in consultancies who identified projects and approached NAMS to progress them • A number of different individuals, organisations and disciplines became ‘evangelists’: accountants, engineers, administrators, elected representatives, auditors. NAMS provided a forum fro them. • Special Interest groups were encouraged to ‘do their own thing’ within a loose framework. (e.g software User Groups) • By having the Auditor-General ‘inside the house’ we jointly developed the rules. This has lead to ongoing legislation change being strongly influenced by the practitioners

20. What could we have done better in hindsight? • We had a software solution but almost no data to use in it! • We raised some expectations too high • Maintaining the drive and consistency is challenging. These projects take years and people move both within and out of the industry • Some projects, notably the CCTV manual are overdue for updates. • Medium sized entities appear to manage change better than small or very large ones. • Don’t worry about freeloaders “Imitation is the greatest form of flattery”

21. NAMS today • Industry based public and private sector interest representation • Fulltime CEO • Mechanical Engineer with sales background • Funded by products and services not subscriptions • Has relationships with similar organisations in Australia, Canada and South Africa. • Has marketing agreements with APWA, FHWA & AASHTO in USA (non exclusive) • 2005 version of IIMM will have USA specific section and USA case studies (Sep/Oct 05) • Keen to develop new relationships

22. www.nams.org.nz +64 7 868 3930