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Written by Annie Bolitho, Principal Insync.
The much anticipated Essential Services Commission (ESC) determination on the 2016-17 Higher Cap applications is now out. On 31 May, the regulator released the decision on the nine applications submitted in the first year of the Fair Go Rates System. Each applicant put a case based on individual circumstances and has received a specific response. The new approach has been spelled out in practice, with the regulator making a clear link between his assessment of each council’s long term financial plan and the way it has taken the community’s views into account.
The success rate of applicants in this round was low.
Councils are now in a position to look to the future, and plan strategically. As organisations delivering large capital works programs and hundreds of services, councils have in place corporate structures and mechanisms to establish long term financial plans that reflect their vision for sustainable services and infrastructure. Now that the determinations have been made, councils that wish to apply in 2017/18 are in a good position to develop and present appropriate planning.
What may be more difficult for councils to do?
One key problem will be to demonstrate a quality approach to marrying community views with this planning. The regulator states that he found quite adequate evidence of community engagement and use of different techniques, in many applications. What he did not find was a clear statement of how the views garnered from citizens actually informed the decision to apply for a variation.
This is the challenge for councils right now. To explore strategically what investment decisions in capital works and services it wants and needs the community to assess.
In earlier briefings, the ESC highlighted that it will not tell councils how to engage. Each council’s situation is different. Nonetheless councils have been strongly encouraged to engage early and in depth, and to go beyond the ‘usual suspects’ to hear from a broader range of citizens. This advice suggests the value of deliberative mechanisms such as citizens’ juries and participatory budgets, and of making selection processes for all engagement processes more representative of council demographics.
Whichever way you look at the 2016/17 determinations, they provide an explicit message: councils must work purposefully to connect citizens with what is to be presented in a proposal.
The ESC has noted: “During community engagements about services and infrastructure, councils must make clear to their community the major financial trade-offs and service impacts of the different choice available. Councils will be expected to identify community responses to the different trade-offs presented and articulate clearly how those responses have informed their applications for a higher cap.”
Our biggest take away from the ESC determinations? Get the community to help assess competing priorities and to decide which trade-offs to make!