PLANT & EQUIPMENT Asset Management Plan - (Comprehensive) Shire of Toodyay
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Shire of Toodyay PLANT & EQUIPMENT Asset Management Plan (Comprehensive)
Shire of Toodyay Asset Management Plan
Document Control
Document ID : Plant & Equipment Asset Management Plan
Rev No Date Revision Details Author Reviewer Approver
July 2018 Manager Corporate Services & CEO
Manager Works and Services
September Manager Corporate Services & CEO
2018 Manager Works and Services
© Copyright 2017 – All rights reserved.
The Institute of Public Works Engineering Australasia.
www.ipwea.org/namsplus
SHIRE OF TOODYAY- PLANT & EQUIPMENT ASSET MANAGEMENT PLAN
TABLE OF CONTENTS
1 EXECUTIVE SUMMARY...................................................................................................................... 1
1.1 The Purpose of the Plan................................................................................................................. 1
1.2 Asset Description ........................................................................................................................... 1
1.3 Levels of Service ............................................................................................................................ 1
1.4 Future Demand .............................................................................................................................. 1
1.5 Lifecycle Management Plan ........................................................................................................... 2
1.6 Financial Summary ........................................................................................................................ 2
1.7 Asset Management Practices......................................................................................................... 3
1.8 Monitoring and Improvement Program ........................................................................................... 3
2. INTRODUCTION .................................................................................................................................. 3
2.1 Background.................................................................................................................................. 3
2.2 Goals and Objectives of Asset Ownership ................................................................................... 5
2.3 Core and Advanced Asset Management ..................................................................................... 7
3. LEVELS OF SERVICE ......................................................................................................................... 7
3.1 Customer Research and Expectations ........................................................................................ 7
3.2 Strategic and Corporate Goals .................................................................................................... 8
3.3 Legislative Requirements............................................................................................................. 9
3.4 Levels of Service ......................................................................................................................... 9
3.4.2 Technical Levels of Service ....................................................................................................... 10
4. FUTURE DEMAND ............................................................................................................................ 13
4.1 Demand Drivers ......................................................................................................................... 13
4.2 Demand Forecasts..................................................................................................................... 13
4.3 Demand Impact on Assets ......................................................................................................... 13
4.4 Demand Management Plan ....................................................................................................... 13
5. LIFECYCLE MANAGEMENT PLAN................................................................................................... 14
5.1 Background Data ....................................................................................................................... 14
5.2 Operations and Maintenance Plan ............................................................................................. 16
5.3 Renewal/Replacement Plan....................................................................................................... 18
5.4 Creation/Acquisition/Upgrade Plan ............................................................................................ 20
5.5 Disposal Plan ............................................................................................................................. 20
6. RISK MANAGEMENT PLAN .............................................................................................................. 21
6.1 Critical Assets ............................................................................................................................ 21
6.2 Risk Assessment ....................................................................................................................... 22
6.4 Service and Risk Trade-Offs ...................................................................................................... 26
7. FINANCIAL SUMMARY ..................................................................................................................... 26
7.1 Financial Statements and Projections........................................................................................ 26
7.2 Funding Strategy ....................................................................................................................... 27
7.3 Key Assumptions Made in Financial Forecasts ......................................................................... 28
7.4 Forecast Reliability and Confidence .......................................................................................... 28
8. PLAN IMPROVEMENT AND MONITORING ..................................................................................... 29
8.1 Status of Asset Management Practices ..................................................................................... 29
8.2 Improvement Plan ...................................................................................................................... 30
8.3 Monitoring and Review Procedures ........................................................................................... 31
8.4 Performance Measures.............................................................................................................. 31
9. REFERENCES ................................................................................................................................... 31
10. APPENDICES .................................................................................................................................... 31
Appendix A Plant and Equipment – Fair Value ............................................................................. 32
Appendix B Projected 10-year Capital Renewal and Replacement Works Program ..................... 33
Appendix C Projected Plant Replacement Schedule..................................................................... 34
Appendix D Projected Maintenance Schedule .............................................................................. 36
Appendix E Budgeted Expenditures accommodated in LTFP ....................................................... 38
Appendix F Abbreviations ............................................................................................................. 40
Appendix G Glossary ..................................................................................................................... 41
SHIRE OF TOODYAY- PLANT & EQUIPMENT ASSET MANAGEMENT PLAN
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1. EXECUTIVE SUMMARY
initiatives which may materially impact on the Plant
1.1 The Purpose of the Plan & Equipment Asset Management Plan;
Technology changes may also impact on the asset
Asset management planning is a comprehensive
management regime; and
process to ensure delivery of services from Plant &
Equipment is provided in a financially sustainable There will be concerted effort to improve the
manner. energy efficiency of all Council plant & equipment.
The Plant & Equipment Asset Management Plan details 1.2 Asset Description
information about Plant & Equipment assets including
actions required to provide an agreed level of service in These assets include:
the most cost effective manner while outlining The Plant & Equipment network comprises:
associated risks. The plan defines the services to be
provided, how the services are provided and what Bushfire Vehicles
funds are required to provide the services over a 10- Equipment
year planning period. Heavy Fleet
Light Fleet
The Plant & Equipment Asset Management Plan is the
link between the Council’s corporate, strategic and Heavy & Light Plant
operational objectives, interpreted as the provision of These assets have a replacement value of $3,706,677.
specific Plant & Equipment to the community for their
enjoyment of agreed Levels of Service for various
community and lifestyle activities.
1.3 Levels of Service
This plan combines the strategic planning, continuous Our present funding levels are sufficient to continue to
improvement and operational management factors to provide existing services at current levels in the
provide Levels of Service associated with community medium term.
needs and to a certain degree, community The main services from Plant & Equipment include:
expectations, (although it is fully acknowledged that
community expectations may never be fully realised). Civil and earthworks
Transportation
The plan provides the guidelines for management of
the Plant & Equipment to ensure: Rapid services, infrastructure services, repairs and
maintenance,
Best appropriate practice asset and services Works associated with parks, gardens and
management for Shire of Toodyay; rangers.
Competent decision-making based on quality
information and contemporary management 1.4 Future Demand
techniques;
Consistent service provision according to needs The main demands for new services are created by:
based criteria.
Strategic and Corporate Goals
The plan relates all relevant regulatory, legislative and Demographic changes and consumer preferences
reasonable practices against the Levels of Service and Regulations
risk management framework. Technological changes
Environmental awareness
This plan also acknowledges that:
Determining the sustainability of existing programs These will be managed through a combination of
may involve the review of all current assets against managing existing assets, upgrading of existing assets
the Levels of Service to identify and address any and providing new assets to meet demand and demand
‘gaps’; management.
From time to time there will be external strategies,
e.g. new Government policy or climate change
SHIRE OF TOODYAY- PLANT & EQUIPMENT ASSET MANAGEMENT PLAN
1.5 Lifecycle Management Plan
What Does it Cost?
The projected outlays necessary to provide the services covered by this Plant & Equipment Asset Management Plan
includes operations, maintenance, renewal and upgrade of existing assets over the 10-year planning period is
$11,658,000 or $1,165,800 on average per year.
1.6 Financial Summary
What We Will Do
Estimated available funding for this period is $11,381,928 or $1,138,193 on average per year which is 98% of the cost to
provide the service. This is a funding shortfall of $27,607 on average per year. Projected expenditure required to provide
services in the Plant & Equipment Asset Management Plan compared with planned expenditure currently included in the
Long Term Financial Plan are shown in the figure below.
Projected Operating and Capital Expenditure
This Plan provides for operation, maintenance, renewal and upgrade expenditure for light fleet, heavy fleet, heavy plant,
minor plant and equipment to meet service levels set by in annual budgets within the 10 year planning period.
What We Cannot Do
Council do not have enough funding to provide all services at the desired service levels or provide new services.
Managing the Risks
There are risks associated with providing the service and not being able to complete all identified activities and projects.
We have identified major risks as:
Insufficient resources including funding to replace/ renew plant & equipment in accordance with renewal forecasts,
Insufficient funding to increasing asset stocks.
We will endeavour to manage these risks within available funding by:
Request funding for renewals as required and monitor trends of maintenance.
SHIRE OF TOODYAY- PLANT & EQUIPMENT ASSET MANAGEMENT PLAN
1.7 Asset Management Practices
Our systems to manage assets include:
Synergy Soft
Microsoft Excel
1.8 Monitoring and Improvement Program
The next steps resulting from Plant & Equipment Asset Management Plan to improve asset management practices are:
Define the delivered customer service levels and develop performance measures;
Continue to monitor plant & equipment condition and make service level based decisions;
Review annual budget preparation to recognise target levels of service vs condition assessments;
Review the Shire’s current Plant & Equipment Asset Management staffing structure against work requirements;
Monitor performance of the Plant & Equipment Asset Management Plan service levels.
2. NTRODUCTION
2.1 Background
The Plant & Equipment Asset Management Plan communicates the actions required for the management of plant and
equipment (and services provided from plant & equipment), compliance with regulatory requirements, and funding
needed to provide the required levels of service over a 10-year planning period.
The Plant & Equipment Asset Management Plan is to be read with the Shire of Toodyay planning documents. This
includes the following associated planning documents:
Strategic Community Plan
Corporate Business Plan
Long Term Financial Plan
Annual Budget
2018 Works & Services Review
The Plant & Equipment covered by Plant & Equipment Asset Management Plan are shown in Table 2.1.
Table 2.1: Assets covered by this Plan
ASSET CATEGORY QUANTITY REPLACEMENT VALUE
Bushfire Vehicles and equipment 19 $1,495,765
Equipment 2 $112,320
Heavy Fleet 5 $407,087
Light Fleet 25 $477,800
Heavy & Light Plant 26 $1,213,705
TOTAL $3,706,677
SHIRE OF TOODYAY- PLANT & EQUIPMENT ASSET MANAGEMENT PLANKey stakeholders in the preparation and implementation of Plant & Equipment Asset Management Plan are shown in
Table 2.1.1.
Table 2.1.1: Key Stakeholders in the AM Plan
KEY STAKEHOLDER ROLE IN ASSET MANAGEMENT PLAN
Councillors Represent needs of community,
Allocate resources to meet planning objectives in providing services while managing risks,
Ensure services are sustainable
Executive Team To ensure that Asset Management policy and strategy is being implemented as adopted,
To ensure that long-term financial needs to sustain the assets for the services they deliver
are advised to Council for its strategic and financial planning processes
Community User Groups Users of services from plant & equipment assets,
Consultation on key issues
Council Staff As the designated strategic custodian of Plant & Equipment, responsible for the overall
management of the assets,
To ensure provision of the required/agreed level of maintenance services for asset
components,
To ensure design and construction of assets meets required/agreed standards,
To ensure that risk management practices are conducted as per Council policy,
To ensure that adequate financial information is provided to Council to the relevant asset
managers to facilitate sound management of the assets
Insurance Provider Partner in insurance and risk management issues
State and Federal Periodic provision of advice, instruction, grants funding to assist with the provision of
Government Departments community assets.
SHIRE OF TOODYAY- PLANT & EQUIPMENT ASSET MANAGEMENT PLAN2.2 Goals and Objectives of Asset Financial summary – what funds are required to
provide the defined services,
Ownership Asset management practices – how to manage
Shire of Toodyay exists to provide services. Some of provision of the services,
these services are provided by Plant & Equipment. Monitoring – how the plan will be monitored to
ensure objectives are met,
The framework of the Plant & Equipment Asset Asset management improvement plan – how to
Management Plan is based on the following principles: increase asset management maturity.
Accountability for Assets– refers to strengthening Other references to the benefits, fundamentals
of the ‘ownership’ of the assets and services to principles and objectives of asset management are:
increase performance and accountability;
Planning and Budgeting – the current and future International Infrastructure Management Manual
financial needs, specifically the Renewal Profile 2015
for plant & equipment and alignment with the ISO 55000
respective depreciation calculations;
The primary issues for the Plant & Equipment assets
Acquiring Assets – the processes of increasing
are:
asset stocks, including assets described in the
Council’s Capital Works Program; Recording asset data – dimensional and condition
Operating and Maintaining Assets – maintenance data stored in an Asset Inventory that can be
and operation of assets is the primary activity; uploaded to the Asset Register;
Disposing of Assets; and Increasing the strategic and tactical management
Asset Recording, Valuing and Reporting – of the assets and services – understanding the
including statutory recording and valuing, and renewal and maintenance needs for the network
performance reporting. and actively managing those needs, both
operationally and financially;
Our goal in managing Plant & Equipment is to meet the
Documentation of the Levels of Service for the
defined level of service (as amended from time to time)
Plant & Equipment, expressed as Service
in the most cost effective manner for present and future
Standards and Service Targets;
consumers. The key elements of Plant & Equipment
An appreciation of the cost of provision of the
management are:
services;
Providing a defined level of service and monitoring The future demand for the assets and services,
performance, understanding the growth and change factors that
Managing the impact of growth through demand influence the management regime;
management and investment in Plant & Forecasting the renewal and maintenance costs
Equipment, for the next 10+ years, and understanding the
Taking a lifecycle approach to developing cost- affordability and sustainability of the assets and
effective management strategies for the long-term services to the current levels.
that meet the defined level of service,
The purpose of this Plant & Equipment Asset
Identifying, assessing and appropriately Management Plan is to:
controlling risks, and
Linking to a long-term financial plan which Improve understanding of the Plant & Equipment
identifies required, affordable expenditure and assets and associated services;
how it will be financed. Improve budgeting and forecasting of asset
related management options and costs,
Key elements of the planning framework are
particularly in understanding the long term
Levels of service – specifies the services and investment in capital renewal;
levels of service to be provided, Afford a level of confidence in forward works
Future demand – how this will impact on future programs, maintenance and provide support for
service delivery and how this is to be met, any business cases associated with securing the
Life cycle management – how to manage existing necessary funding requirements; and
and future assets to provide defined levels of Provide the guidance for elected members and
the organisation in taking positive steps toward
service,
advanced asset management planning.
SHIRE OF TOODYAY- PLANT & EQUIPMENT ASSET MANAGEMENT PLANA road map for preparing an asset management plan is shown below.
Road Map for preparing an Asset Management Plan
Source: IPWEA, 2006, IIMM, Fig 1.5.1, p 1.11
CORPORATE PLANNING
Confirm strategic objectives and establish AM
policies, strategies & goals.
Define responsibilities & ownership.
Decide core or advanced AM Pan.
Gain organisation commitment.
REVIEW/COLLATE ASSET INFORMATION
Existing information sources
Identify & describe assets.
Data collection
Condition assessments
Performance monitoring
Valuation Data
INFORMATION MANAGEMENT, and DATA IMPROVEMENT
DEFINE SCOPE &
STRUCTURE OF PLAN
ESTABLISH LEVELS OF SERVICE
Establish strategic linkages
Define & adopt statements
AM PLAN Establish measures & targets
REVIEW AND Consultation
AUDIT
LIFECYCLE MANAGEMENT STRATEGIES
Develop lifecycle strategies
Describe service delivery strategy
Risk management strategies
Demand forecasting and management
Optimised decision making (renewals, new works,
disposals)
Optimise maintenance strategies
IMPLEMENT
IMPROVEMENT FINANCIAL FORECASTS
STRATEGY Lifecycle analysis
Financial forecast summary
Valuation Depreciation
Funding
IMPROVEMENT PLAN
Assess current/desired practices
Develop improvement plan
ITERATION
IS THE PLAN Reconsider service statements
AFFORDABLE? Options for funding
Consult
ANNUAL PLAN /
BUSINESS PLAN
SHIRE OF TOODYAY- PLANT & EQUIPMENT ASSET MANAGEMENT PLAN2.3 Core and Advanced Asset Levels of Service: the service quality for a particular
activity against which service performance may be
Management measured - a high level statement linking strategic
This Plant & Equipment Asset Management Plan is
objectives with service delivery;
prepared as a ‘core’ asset management plan over a 10 Service Standards: the manner of provision of the
year planning period. It is prepared to meet minimum
services, (in quantitative terms, e.g. function, design
legislative and user requirements for sustainable
and amenity / presentation).
service delivery and Long Term Financial Planning and
reporting. Core asset management is a ‘top down’ Service Targets: the targets for the services required
approach where analysis is applied at the system or to achieve and maintain the Service Standards,
network level. measured as intervention criteria and response times.
Future revisions of the Plant & Equipment Asset The Service Targets are used to calculate the level of
Management Plan will move towards ‘advanced’ asset resources, costs and performance required to achieve
management using a ‘bottom up’ approach for against the needs.
gathering detailed asset information for individual
This Plant & Equipment Asset Management Plan
assets to support the provision of activities and
programs to meet agreed service levels in a financially
introduces the framework concept to account for Levels
sustainable manner.
of Service according to whole of life programs for the
assets.
3. LEVELS OF SERVICE The Levels of Service defined in this Plan will be used
to:
3.1 Customer Research and
inform stakeholders of the proposed type and
Expectations Levels of Service to be offered;
This section of the Plant & Equipment Asset identify the costs and benefits of the services
Management Plan describes the Levels of Service offered;
framework development process for Plant & Equipment enable stakeholders to asses suitability,
for the Shire of Toodyay. The framework recorded is affordability and equity of the services offered;
derived from interpretation of Council’s corporate measure the effectiveness of the Plant &
objectives and strategies, perceived customer ‘needs’ Equipment Asset Management Plan, and;
and relevant statutory requirements. focus the asset and services management
strategies required and developed to deliver the
To both fully understand and deliver on desired Levels required Levels of Service.
of Service requires suitable asset and services
management policies, guidelines, inspection regimes, The Levels of Service framework is to be based on:
condition assessment programs, customer inquiry
systems and asset and services management practices Research and needs: predominantly historical
and processes, plus the development and information;
implementation of various audits to validate the outputs. Strategic and Corporate Goals: identifying the
specific objectives which the organisation wishes
Statistical indicators show that over the past four years, to achieve from the Levels of Service, together
the Shire of Toodyay has had a static population base. with guidance to define the scope of current and
There has been a significant change in age structure future services offered and the manner of the
with less young people, less mid lifers and significantly service delivery;
more aged people. This confirms the need to now Legislative requirements: the legislation,
specify the Levels of Service for defined service regulations, environmental standards and industry
programs on behalf of the community. Likewise the and Australian Standards that impact on the way
need to understand the affordability of the programs assets are managed; and
becomes an imperative for the organisation and the Design Standards and Codes of Practice:
community. Australian Design Standards provide a set of
design parameters for the delivery of Plant &
Levels of Service represent a balance between funding, Equipment.
physical resources and customer nee.ds. The Levels
of Service framework includes the following elements,
(defined as):
SHIRE OF TOODYAY- PLANT & EQUIPMENT ASSET MANAGEMENT PLAN3.2 Strategic and Corporate Goals
This Plant & Equipment Asset Management Plan is prepared under the direction of the Shire of Toodyay vision, mission,
goals and objectives.
Our vision is: “We are a vibrant rural community that celebrates our past and embraces a sustainable future.”
Our mission is: “Local Government and community working together to obtain the best possible social, economic and
environmental outcomes for the Toodyay Shire.”
Relevant goals and objectives and how these are addressed in Plant & Equipment Asset Management Plan are:
Table 3.2: Goals and how these are addressed in this Plan
HOW GOAL AND OBJECTIVES ARE
GOAL OBJECTIVE
ADDRESSED IN AM PLAN
Social: Objective 2: Facilitate community safety and Provide fit-for-purpose plant & equipment
Our community wellbeing. for emergency services, and law and
wellbeing and S 2.3: Collaborate with fire and emergency services, order programs.
connection law and order programs and other volunteer services.
Built Environment: Objective 3: Improve processes to support the built Optimisation of Asset condition –
Our buildings, roads environment. maintaining the asset condition equitably
and transport S 3.2: Implement asset rationalisation and throughout the network of plant and
consolidation. equipment assets.
Governance: Objective 3: Ensure rigorous organisational systems. Review plant and equipment
The way the Shire S 3.1: Maintain long term financial and resourcing requirements for roads and other
leads and operates plans. infrastructure programs.
Provide fit-for-purpose plant & equipment
for Council municipal and regulatory
services.
SHIRE OF TOODYAY- PLANT & EQUIPMENT ASSET MANAGEMENT PLAN3.3 Legislative Requirements
There are many legislative requirements relating to the management of Plant & Equipment. These include:
Table 3.3: Legislative Requirements
LEGISLATION REQUIREMENT
Local Government Act 1995 Sets out role, purpose, responsibilities and powers of local governments
including the preparation of a Long Term Financial Plan supported by Asset
Management Plans for sustainable service delivery. The Act also provides
guidance on the rules around local governments who derive revenue from
operations such as non-core business.
Road Traffic Act 1974 Requirement to licence vehicles to be driven on the road, and all driving
regulations.
Road Traffic Amendment Act 2000 Requirement for the owner of the vehicle to be liable for drivers’ compliance with
the regulations.
Motor Vehicle Standards Act 1989 Requirement to register and assign identification to each vehicle imported to or
manufactured in Australia.
Disability Services Act 1993 (WA) To ensure that services are provided and funded in conformity with the Act.
Emergency Management Act 2004 (WA) Requires lifeline utilities to function at the fullest possible extent during and after
an emergency and to have business continuity plans.
Work Health and Safety Act2011 Requirement for organisations and individuals to apply a duty of care to others.
Includes requirements for undertaking to ensure, so far as is reasonably
practicable the provision and maintenance of safe plant and the safe use,
handling and storage of plant.
Accounting Standards AASB 5 Non-Current Assets Held for Sale and Discontinued Operations
AASB 13 Fair Value Measurement
AASB 116 Property, Plant and Equipment
AASB 118 Revenue
AASB 119 Employee Benefits
AASB 136 Impairment of Assets
AASB 138 Intangible Assets
AASB 140 Investment Property
Other Standards and Regulations Other relevant documents include, but are not limited to: AS/NZS 4360: 1995
Risk Management, all other relevant State and Federal Acts & Regulations, all
Local Laws and relevant policies of the organisation
3.4 Levels of Service
Service levels are defined service levels in two terms, customer levels of service and technical levels of service. These
are supplemented by organisational measures.
Customer Levels of Service measure how the customer receives the service terms of safety, quality, quantity,
reliability, responsiveness, cost/efficiency and legislative compliance and whether value to the customer is provided.
Technical Levels of Service supporting the community service levels to ensure that the minimum community levels of
service are met. These technical measures relate to service criteria such as:
Quality – plant & equipment is operational, reliable, comfortable for operators and easy to maintain,
Quantity – number of assets is sufficient for Council operations and service delivery,
Availability – plant & equipment is fit for purpose, efficient and adaptable for other jobs,
Safety – plant & equipment is maintained, services and repaired to industry standards.
SHIRE OF TOODYAY- PLANT & EQUIPMENT ASSET MANAGEMENT PLAN3.4.1 Customer Levels of Service
Customer levels of service measures used in the asset management plan are:
Quality: How good is the service …
What is the condition or quality of the service?
Function: Is it suitable for its intended purpose ….
Is it the right service?
Capacity/Use: Is the service over or under used …
Do we need more or less of these assets?
Table 3.5 shows the expected levels of service based on resource levels in the current long-term financial plan.
3.4.2 Technical Levels of Service
Technical Levels of Service: Supporting the customer service levels are operational or technical measures of
performance. These technical measures relate to the allocation of resources to service activities to best achieve the
desired customer outcomes and demonstrate effective performance.
Technical service measures are linked to the activities and annual budgets covering:
Operations – the regular activities to provide services,
Maintenance – the activities necessary to retain an asset as near as practicable to an appropriate service condition.
Maintenance activities enable an asset to provide service for its planned life (e.g. regular inspection and repair of
components),
Renewal – the activities that return the service capability of an asset up to that which it had originally (e.g.
replacement of plant & equipment),
Upgrade/New – the activities to provide a higher level of service (e.g. replacing major components) or a new
service that did not exist previously (e.g. a new plant & equipment).
Service and asset managers plan, implement and control technical service levels to influence the customer service
levels.
Table 3.5 shows the customer levels of service and technical levels of service expected to be provided under the Plant &
Equipment Asset Management Plan.
Plant and equipment items meet demands for performance, reliability, affordability,
SERVICE STATEMENT
environmental outputs and safety for the operator/driver and community.
SERVICE FACTORS CUSTOMER LEVELS OF SERVICE TECHNICAL LEVELS OF SERVICE
QUALITY
Council Needs Plant and equipment item matches needs Regular liaison with Council staff to ascertain and
at an affordable cost. confirm plant and equipment needs.
Quality plant and equipment to specifications and
available funding/ agreed lease cost.
Plant and equipment items replacement/ renewal
cycle aligned with good industry standards and
affordability.
Available Resources / Only essential plant and equipment is Non capital solutions such as operating leases
Funding purchased. may be proposed for programmed plant and
equipment upgrades – decreasing capital costs.
Organisational Profile Plant and equipment are safe to use. Plant and equipment items match Council
and Policies policies for performance, safety and equipment
levels.
SHIRE OF TOODYAY- PLANT & EQUIPMENT ASSET MANAGEMENT PLANSERVICE FACTORS CUSTOMER LEVELS OF SERVICE TECHNICAL LEVELS OF SERVICE
Commercial Realities Keep plant and equipment management Plant and equipment item maintained by
and operational costs as low as possible preventative maintenance/routine servicing and
good operational standards.
Comparison of Council ownership vs lease option
for plant and equipment items.
Hire rates and arrangements are consistent with
private market forces for equivalent plant and
equipment items.
Function
Design Standards Plant and equipment items meets the Plant and Equipment meets or exceeds Council’s
needs of council staff and have reasonable functional specification and remains within cost
operating costs. parameters for purchase and operations.
Safety Plant and equipment item provides the Plant and equipment item conforms to
required degree of safety for operator and manufacturer’s specifications – no unauthorised
public. modifications.
Plant and equipment item serviced and
maintained according to manufacturer’s
specifications.
Plant and equipment item designed and
maintained to relevant Workplace Health &
Safety provisions.
Operators maintain licences and skills through
ongoing training.
Availability / Reliability Plant and equipment item is reliable and Capacity of plant and equipment item matches or
available for use. exceeds requirement for specified operating
demands.
Plant and equipment item quality matches
capacity and operating needs and affordability.
Operator is trained and experienced to optimise
the performance and output from the plant and
equipment item.
Routine maintenance/servicing/repair programs
and times optimise availability and output.
Environmental Plant and equipment items match or Plant and equipment items design alternatives
Standards exceeds Council’s current environmental favour high environmental outcomes.
standards. Operator/driver training matches preferred
environmental outcomes.
Economy Plant and equipment item offers good Operators and drivers trained to operate/drive to
operating economy, both from an optimise fuel economy, tyre and general wear
ownership and an operational perspective. and tear on plant and equipment items.
Regular inspections of plant and equipment items
to confirm care and attention by operators/drivers
for presentation and operation.
SHIRE OF TOODYAY- PLANT & EQUIPMENT ASSET MANAGEMENT PLANSERVICE FACTORS CUSTOMER LEVELS OF SERVICE TECHNICAL LEVELS OF SERVICE
Comfort Plant and equipment item provides good Plant and equipment items have proper air-
driver/operator comfort consistent with conditioning/ventilation systems to provide good
plant and equipment item tasks, including operator comfort in typical operational
long duration operational activities. circumstances.
Seating meets high standard/ design criteria for
operator/driver and passenger comfort and
support.
Operator cabin/driving space properly insulated
from operating/ engine noises.
Industrial plant located clear of obstacles and
near materials supply.
Maintenance and All servicing can be done on site. Majority of services able to be undertaken in
Operational Activities Council workshop.
Capacity / Use
Presentation / Amenity Plant and equipment items maintained in Plant and equipment maintenance, operation and
clean and tidy condition – presentation to presentation actions contribute to higher resale
community at appropriate standards. values and lower operating costs – responsible
manager to ensure high standards are
maintained.
Utilisation Utilisation of plant & equipment meets Utilisation is maximised, minimum idle hours
required need or demand
The current levels of service have been developed through internal consultation. It is important to monitor the service
levels provided regularly as these will change. The current performance is influenced by work efficiencies and
technology, and customer priorities will change over time. Review and establishment of an agreed position which
achieves the best balance between service, risk and cost is essential. As such, continuous monitoring and review of
levels of service will form part of the continuous improvement plan.
SHIRE OF TOODYAY- PLANT & EQUIPMENT ASSET MANAGEMENT PLAN4. FUTURE DEMAND
4.1 Demand Drivers
Drivers affecting demand include Strategic and Corporate goals, population change, changes in demographics,
seasonal factors, vehicle ownership rates, consumer preferences and expectations, technological changes, economic
factors, regulatory changes, environmental awareness, etc.
4.2 Demand Forecasts
The present position and projections for demand drivers that may impact future service delivery and use of assets were
identified and are documented in Table 4.3.
4.3 Demand Impact on Assets
The impact of demand drivers that may affect future service delivery and use of assets are shown in Table 4.3.
Table 4.3: Demand Drivers, Projections and Impact on Services
DEMAND DRIVERS PRESENT POSITION PROJECTION IMPACT ON SERVICES
Economic Demand The withdrawal of fleet vehicle licence Anticipated to continue Increasingly difficult to maintain the
fee and stamp duty concessions will current level of service.
increase the cost of operating and A review of the current costs of
renewing the portfolio. individual assets compared to their
Increasing energy costs: It is likely that level of usage in order to identify
prices for basic commodities will opportunities for efficiency gains.
continue to rise above normal inflation
levels over the life of this AMP.
Social Demand Shire of Toodyay has had a static Increase in demand for all Review and document levels of
population base over the last four services demand.
years. Analysis of demographics shows Increased maintenance and Encourage sharing of existing plant
an ageing population and less young renewal costs and equipment to maximise
people in the Shire. utilisation.
Technology Condition monitoring and Asset Anticipated to continue to Change in technology may provide
Management systems – the need to change increased fuel efficiency, operator
manage data in the form of inventories, comfort and safety.
condition ratings, financial performance Review of Council’s long term ability
etc. to maintain increasingly sophisticated
assets.
Multi- function/ multi-purpose plant
and equipment improves operational
efficiency.
Environment Preference for the acquisition of Anticipated to continue A review of the asset management
environmentally friendly assets with resources required to effectively
lower whole of life costs. manage the portfolio.
4.4 Demand Management Plan
Demand for new services will be managed through a combination of managing existing assets, upgrading of existing
assets and providing new assets to meet demand and demand management. Demand management practices include
non-asset solutions, insuring against risks and managing failures.
Non-asset solutions focus on providing the required service without the need for asset ownership and management
actions including reducing demand for the service, reducing the level of service (allowing some assets to deteriorate
beyond current service levels) or educating customers to accept appropriate asset failures. Examples of non-asset
solutions include providing services from existing plant and equipment such as hiring of plant and equipment instead of
purchasing outright, and sharing plant and equipment with other Councils where practical. Further opportunities will be
developed in future revisions of Plant & Equipment Asset Management Plan.
SHIRE OF TOODYAY- PLANT & EQUIPMENT ASSET MANAGEMENT PLAN5. LIFECYCLE MANAGEMENT PLAN
The lifecycle management plan details how the Shire of Toodyay plans to manage and operate the assets at the agreed
levels of service (defined in Section 3) while managing life cycle costs.
Life Cycle Management is recognised by the Shire of Toodyay as an essential component of the provision and
management of assets and services. Life Cycle Management is primarily about using the data and processes to
effectively provide, manage, maintain, renew, (and upgrade), existing plant and equipment.
Lifecycle asset management means considering all management options and strategies as part of the asset lifecycle,
from planning to disposal, (whole of life analysis). The objective of managing the assets in this manner is to look at long-
term cost impacts, (or savings), when making asset and services management decisions.
5.1 Background Data
5.1.1 Physical parameters
The assets covered by this Plant & Equipment Asset Management Plan are shown in Table 2.1.
The age profile of the assets included in the Plant & Equipment Asset Management Plan are shown in Figure 2.
Figure 2: Asset Age Profile
5.1.2 Asset capacity and performance
Assets are generally provided to meet design standards where these are available.
Locations where deficiencies in service performance are known are detailed in Table 5.1.2.
Table 5.1.2: Known Service Performance Deficiencies
LOCATION SERVICE DEFICIENCY
Fleet Maintenance Review Workshop facilities, capacity to meet current and future fleet maintenance
requirements (computer scanning machine, improved layout of workshop, upgrade of
tools)
Utilisation Underutilised plant that are a result of staffing, seasonal works and demand for use of
equipment
SHIRE OF TOODYAY- PLANT & EQUIPMENT ASSET MANAGEMENT PLAN5.1.3 Asset condition
Current plant and equipment conditions were last assessed in 2017. With the condition rating of each of the plant and
equipment elements having been established, it is possible to attribute a whole of asset condition rating.
Following the adoption of this Plan, condition audits of plant and equipment will be undertaken over a three year cycle.
This is to help even out inspections, budgets and workloads. This has been identified as an improvement action.
Condition of assets are rated using a 1-5 rating system with 1 being new or near-new and 5 representing an asset that
has failed completely and cannot be used for the purpose it was in service for.
The condition profile of our assets is shown in Figure 3.
Fig 3: Asset Condition Profile
The majority of Council plant and equipment is in either “Very Good” or “Good” condition.
Condition is measured using a 1 – 5 grading system as detailed in Table 5.1.3.
Table 5.1.3: Simple Condition Grading Model
CONDITION GRADING DESCRIPTION OF CONDITION
1 Very Good: only planned maintenance required
2 Good: minor maintenance required plus planned maintenance
3 Fair: significant maintenance required
4 Poor: significant renewal/rehabilitation required
5 Very Poor: physically unsound and/or beyond rehabilitation
5.1.4 Asset valuations
The value of assets recorded in the asset register as at 30 June 2017 covered by the Plant & Equipment Asset
Management Plan is shown below. Assets were last revalued at 30 June 2016. Assets are valued at Fair Value.
Gross
Gross Replacement Cost $4,179,242 Replacement
Cost
Accumulated
Depreciable Amount $4,179,242 Depreciation
Depreciated Annual Depreciable
Depreciated Replacement Cost $3,706,677 Replacement Depreciation Amount
Cost Expense
Annual Average Asset Consumption $459,837
End of End of Residual
reporting reporting Value
period 1 period 2
Useful Life
SHIRE OF TOODYAY- PLANT & EQUIPMENT ASSET MANAGEMENT PLAN5.2 Operations and Maintenance Plan 5.2.2 Operations and Maintenance Strategies
Operations include regular activities to provide services The Shire of Toodyay will operate and maintain assets
such as road grading and tree pruning. to provide the defined level of service to approved
budgets in the most cost-efficient manner. The
Routine maintenance is the regular on-going work that operation and maintenance activities include:
is necessary to keep assets operating, including
instances where portions of the asset fail and need Scheduling operations activities to deliver the
immediate repair to make the asset operational again, defined level of service in the most efficient
for example, servicing of plant and equipment. manner,
5.2.1 Operations and Maintenance Plan Undertaking maintenance activities through a
planned maintenance system to reduce
Operations activities affect service levels including maintenance costs and improve maintenance
quality and function through the types and timing of outcomes. Undertake cost-benefit analysis to
activities, and the design of the plant and equipment. determine the most cost-effective split between
planned and unplanned maintenance activities (50
Maintenance includes all actions necessary for – 70% planned desirable as measured by cost),
retaining an asset as near as practicable to an
appropriate service condition including regular ongoing Maintain a current risk register for assets and
day-to-day work necessary to keep assets operating. present service risks associated with providing
For example, servicing but excluding rehabilitation or services from Plant & Equipment assets and
renewal. Maintenance may be classified into reactive, reporting Very High and High risks and residual
planned and specific maintenance work activities. risks after treatment to management and Council,
Reactive maintenance is unplanned repair work carried Review current and required skills base and
out in response to service requests and implement workforce training and development to
management/supervisory directions. meet required operations and maintenance needs,
Planned maintenance is repair work that is identified Review asset use to identify under used assets
and managed through a servicing schedule. Servicing and appropriate remedies, and over used assets
activities include inspection, assessing the condition and customer demand management options,
against failure/breakdown experience, priority of works,
scheduling, actioning the work and reporting what was Maintain a current hierarchy of critical assets and
done to develop a maintenance history and improve required operations and maintenance activities,
maintenance and service delivery performance.
Develop and regularly review appropriate
Specific maintenance is replacement of higher value emergency response capability,
components/sub-components of assets that is
undertaken on a regular cycle including repainting, Review management of operations and
replacing air conditioning units, etc. This work falls maintenance activities to ensure best value for the
below the capital/maintenance threshold but may resources used.
require a specific budget allocation.
5.2.3 Asset Hierarchy
Maintenance expenditure levels are considered to be
adequate to meet projected service levels, which may An asset hierarchy provides a framework for structuring
be less than or equal to current service levels. Where data in an information system to assist in collection of
maintenance expenditure levels are such that will result data, reporting information and making decisions. The
in a lesser level of service, the service consequences hierarchy includes the asset class and component used
and service risks have been identified and service for asset planning and financial reporting and service
consequences highlighted in the Plant & Equipment level hierarchy used for service planning and delivery.
Asset Management Plan and service risks considered
Council has not yet developed an asset service
in the Risk Management Plan.
hierarchy, this will be developed for future plans.
Assessment and priority of reactive maintenance is
undertaken by staff using experience and judgement.
SHIRE OF TOODYAY- PLANT & EQUIPMENT ASSET MANAGEMENT PLAN5.2.4 Critical Assets
Critical assets are those assets which have a high consequence of failure but not necessarily a high likelihood of failure.
By identifying critical assets and critical failure modes, investigative activities, maintenance plans and capital expenditure
plans can be targeted at the appropriate time.
Operations and maintenances activities may be targeted to mitigate critical assets failure and maintain service levels.
These activities may include increased inspection frequency, higher maintenance intervention levels, etc.
Council has not yet developed a list of the critical assets, this will be developed for future plans.
5.2.5 Standards and Specifications
Maintenance work is carried out in accordance with the following Standards and Specifications.
Australian Standards relevant to the works being undertaken
Occupational Health and Safety Standards
Motor Vehicle Standards
Manuals provided by manufacturer
5.2.6 Summary of Future Operations and Maintenance Expenditures
Future operations and maintenance expenditure is forecast to trend in line with the value of the asset stock as shown in
Figure 4. Note that all costs are shown in current 2017/18 dollar values (i.e. real values).
Figure 4: Projected Operations and Maintenance Expenditure
Maintenance is funded from the operating budget where available.
SHIRE OF TOODYAY- PLANT & EQUIPMENT ASSET MANAGEMENT PLAN5.3 Renewal/Replacement Plan Using ‘low cost’ renewal methods (cost of renewal
is less than replacement) wherever possible,
Renewal and replacement expenditure is major work Maintain a current risk register for assets and
which does not increase the asset’s design capacity but service risks associated with providing services
restores, rehabilitates, replaces or renews an existing from Plant & Equipment assets and reporting
asset to its original service potential. Work over and Very High and High risks and residual risks after
above restoring an asset to original service potential is treatment to management and Council,
upgrade/expansion or new works expenditure resulting Review current and required skills base and
in additional future operations and maintenance costs. implement workforce training and development to
meet required needs,
Replacement and rehabilitation of existing plant and Maintain a current hierarchy of critical assets and
equipment is based on the following considerations: capital renewal treatments and timings required ,
Review management of capital renewal and
a condition rating applied to each asset; replacement activities to ensure the best value for
an assumed economic life applied to each asset resources used is obtained.
group;
a replacement date for each asset; 5.3.3 Renewal ranking criteria
asset replacement cost.
Asset renewal and replacement is typically undertaken
5.3.1 Renewal plan to either:
There are a number of methods to identify the renewal/ Ensure the reliability of the existing assets to
replacement requirements for plant and equipment. deliver the service it was constructed to facilitate,
This plan uses a combination of the following methods: or
To ensure the assets are of sufficient quality to
Asset Register data to project the renewal costs meet the service requirements.
using acquisition year and useful life to determine
the renewal year, and It is possible to get some indication of capital renewal
Capital renewal expenditure projections from and replacement priorities by identifying assets or asset
external condition modelling systems. groups that:
5.3.2 Renewal and Replacement Strategies Have a high consequence of failure,
Have high use and subsequent impact on users
Council will plan capital renewal and replacement would be greatest,
projects to meet level of service objectives and Have a total value represents the greatest net
minimize plant and equipment service risks by: value,
Have the highest average age relative to their
Planning and scheduling renewal projects to
expected lives,
deliver the defined level of service in the most
Have high operational or maintenance costs, and
efficient manner,
Have replacement with a modern equivalent asset
Undertaking project scoping for all capital renewal
that would provide the equivalent service at a
and replacement projects to identify:
savings.
o the service delivery ‘deficiency’, present
The ranking criteria used to determine priority of
risk and optimum time for
identified renewal and replacement proposals will be
renewal/replacement,
incorporated into future plans.
o the project objectives to rectify the
deficiency, 5.3.4 Renewal and replacement standards
o the range of options, estimated capital and
life cycle costs for each options that could Renewal work is carried out in accordance with the
address the service deficiency, following standards and specifications.
o and evaluate the options against adopted
evaluation criteria, and Council Policies
o select the best option to be included in Compliance with current regulations, laws and
capital renewal programs, statutes
Industry best practice
SHIRE OF TOODYAY- PLANT & EQUIPMENT ASSET MANAGEMENT PLAN5.3.5 Summary of future renewal and replacement expenditure Projected future renewal and replacement expenditures are forecast to increase over time when the asset stock increases. The expenditure is required is shown in Fig 5. Note that all amounts are shown in real values. The projected capital renewal and replacement program is shown in Appendix B. Renewals and replacement expenditure in the capital works program will be accommodated in the Long Term Financial Plan. This is further discussed in Section 7. . SHIRE OF TOODYAY- PLANT & EQUIPMENT ASSET MANAGEMENT PLAN
5.4 Creation/Acquisition/Upgrade 5.5 Disposal Plan
Plan Disposal includes any activity associated with disposal
of a decommissioned asset including sale, demolition
New works are those works that create a new asset
that did not previously exist, or works which upgrade or or relocation. Assets identified for possible
improve an existing asset beyond its existing capacity. decommissioning and disposal are shown in Appendix
They may result from growth, social or environmental C, together with estimated annual savings from not
needs. Assets may also be acquired at no cost. having to fund operations and maintenance of the
assets. These assets will be further reinvestigated to
5.4.1 Selection criteria determine the required levels of service and see what
options are available for alternate service delivery, if
New assets and upgrade/expansion of existing assets any. Any costs or revenue gained from asset disposals
are identified from various sources such as community is accommodated in the Long Term Financial Plan.
requests, proposals identified by strategic plans or
partnerships with others. Candidate proposals are Where cash flow projections from asset disposals are
inspected to verify need and to develop a preliminary not available, these will be developed in future revisions
renewal estimate. Verified proposals are ranked by of the Plant & Equipment Asset Management Plan.
priority and available funds and scheduled in future
works programmes.
5.4.2 Capital Investment Strategies
Capital upgrade and new projects will be planned to
meet level of service objectives by:
Planning and scheduling capital upgrade and new
projects to deliver the defined level of service in
the most efficient manner,
Undertake project scoping for all capital
upgrade/new projects to identify:
o the service delivery ‘deficiency’, present
risk and required timeline for delivery of the
upgrade/new asset,
o the project objectives to rectify the
deficiency including value management for
major projects,
o the range of options, estimated capital and
life cycle costs for each options that could
address the service deficiency,
o management of risks associated with
alternative options,
o and evaluate the options against
evaluation criteria adopted by Council, and
o select the best option to be included in
capital upgrade/new programs,
Review current and required skills base and
implement training and development to meet
required construction and project management
needs,
Review management of capital project
management activities to ensure Council is
obtaining best value for resources used.
Standards and specifications for new assets and for
upgrade/expansion of existing assets are the same as
those for renewal shown in Section 5.3.2.
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