Benchmarking for New Zealand Councils
benchmarking (present participle)
1. evaluate (something) by comparison with a standard.
“we are benchmarking our performance against external criteria”
The term Benchmarking has had a long and sometimes rocky history. To cut a long and tedious story short, commercial consultancies of the nineties attempted (most of them unsuccessfully) to peddle financial benchmarking where best practice criteria (benchmark data), drawn from firms with “assumed” – comparable business plans, could be incorporated into the budgets (target-setting) of other so called ”comparable firms”.
Only problem was … few if any “really” comparable commercial firms were to be found. Contrast this private sector financial situation with Local Government Council’s – “their firm” equivalents.
New Zealand Territorial Councils are extremely (almost perfectly) comparable one with the other … for their finances. They are therefore excellent candidates for the use of financial benchmarking techniques.
Consider this list of Council similarities.
All New Zealand Territorial Councils:
- are governed by and operate in accord with exactly the same/strictly comparable statutory and other financial directives and practice guideline’s
- are involved in comparable activities, including revenue-raising and expenditures that are governed by statute or are as delegated to them by Central Government and …
- any variations in Council activities are at the margin and have little impact on the efficacy of the use of benchmarking.
The cprlifesaver benchmarking process, see cprlifesaver-application, https://cprlifesaver.co.nz/cprlifesaver-application/, provides a ready to run framework and a set of utilities to enable New Zealand Councils to cost-effectively incorporate relevant financial benchmarks into their long term financial plans.
Council Financial Benchmarks supported … by the Highest Authority
Authority has been given to Local Authority benchmarking from the Guru, (David Shand) in his eminent committee’s seminal … and still influential 2007 report titled “ Funding Local Government Report of the Local Government Rates Inquiry Pakirehua mō ngā Reiti Kaunihera ā-Rohe
“Shand” explicitly supported NZ Council financial benchmarking:
At para 122. (pg 17)
“There is also a need for better reporting by councils on their performance.
Some work has been initiated already within local government to develop some relevant and standardised performance measures that would be used to measure changes in performance within a council over time and to make comparisons with other councils.
This is a difficult but important area and adequate time is needed to develop such a performance measurement and benchmarking framework”.
And … at Recommendation 88 (pg 27)
“That local government, in consultation with other stakeholders, move to develop a system of performance benchmarking”.
Using the resources of the purpose-built benchmarking utility … the cprlifesaver-application https://cprlifesaver.co.nz/cprlifesaver-application/, Councils can now, at minimal expense adopt and fully implement their own customised and standard benchmarked long-term financial plans.
Larry Mitchell, 22 February 2022
Phone: 0274 792 328