Is biggest best? A comparative analysis of the financial viability of the Brisbane City Council

Structural reform through forced mergers has been a dominant feature of Australian local government for decades. Advocates of compulsory consolidation contend that larger municipalities perform better across a wide range of attributes, including financial sustainability. While empirical scholars of local government have invested considerable effort into investigating these claims, no-one has yet examined the performance of Brisbane City Council against other local authorities, despite the fact that it is by far the largest council in Australia. This paper seeks to remedy this neglect by comparing Brisbane with Sydney City Council, an average of six south east Queensland councils and an average of ten metropolitan New South Wales councils against four measures of financial performance over the period 2008 to 2011.

Incorporating sustainability measures in life-cycle financial decision making for highway construction

Public awareness and the nature of highway construction works demand that sustainability measures are first on the development agenda. However, in the current economic climate, individual volition and enthusiasm for such high capital investments do not present as strong cases for decision making as the financial pictures of pursuing sustainability. Some stakeholders consider sustainability to be extra work that costs additional money. Though, stakeholders realised its importance in infrastructure development. They are keen to identify the available alternatives and financial implications on a lifecycle basis. Highway infrastructure development is a complex rocess which requires expertise and tools to evaluate investment options, such as environmentally sustainable features for road and highway development. Life-cycle cost analysis (LCCA) is a valuable approach for investment decision making for construction works. However, LCCA applications in highway development are still limited. Current models, for example focus on economic issues alone and do not deal with sustainability factors, which are more difficult to quantify and encapsulate in estimation modules. This paper reports the research which identifies sustainability related factors in highway construction projects, in quantitative and qualitative forms of a multi-criteria analysis. These factors are then incorporated into past and proven LCCA models to produce a new long term decision support model. The research via questionnaire, model building, analytical hierarchy processes (AHP) and case studies have identified, evaluated and then processed highway sustainability related cost elements. These cost elements need to be verified by industry before being integrated for further development of the model. Then the Australian construction industry will have a practical tool to evaluate investment decisions which provide an optimum balance between financial viability and sustainability deliverables.

Managing financial implications for sustainable highway infrastructure delivery

Highway construction works have significant bearings on all aspects of sustainability. As they typically involve huge capital funds, stakeholders tend to place all interests on the financial justifications of the project, especially when embedding sustainability principles and practices may demand significant initial investment. Increasing public awareness and government policies demand that infrastructure projects respond to environmental challenges and people start to realise the negative consequences of not to pursue sustainability. Stakeholders are now keen to identify sustainable alternatives and financial implications of including them on a whole lifecycle basis. Therefore tools that aid the evaluation of investment options, such as provision of environmentally sustainable features in roads and highways, are highly desirable. Life-cycle cost analysis (LCCA) is generally recognised as a valuable approach for investment decision making for construction works. However to date it has limited application because the current LCCA models tend to focus on economic issues alone and are not able to deal with sustainability factors. This paper reports a research on identifying sustainability related factors in highway construction projects, in quantitative and qualitative forms of a multi-criteria analysis. These factors are then incorporated into existing LCCA models to produce a new sustainability based LCCA model with cost elements specific to sustainability measures. This presents highway project stakeholders a practical tool to evaluate investment decisions and reach an optimum balance between financial viability and sustainability deliverables.

Developing financial decision support for highway infrastructure sustainability

The development of highway infrastructure typically requires major capital input over a long period. This often causes serious financial constraints for investors. The push for sustainability has added new dimensions to the complexity in the evaluation of highway projects, particularly on the cost front. This makes the determination of long-term viability even more a precarious exercise. Life-cycle costing analysis (LCCA) is generally recognised as a valuable tool for the assessment of financial decisions on construction works. However to date, existing LCCA models are deficient in dealing with sustainability factors, particularly for infrastructure projects due to their inherent focus on the economic issues alone. This research probed into the major challenges of implementing sustainability in highway infrastructure development in terms of financial concerns and obligations. Using results of research through literature review, questionnaire survey of industry stakeholders and semi-structured interview of senior practitioners involved in highway infrastructure development, the research identified the relative importance of cost components relating to sustainability measures and on such basis, developed ways of improving existing LCCA models to incorporate sustainability commitments into long-term financial management. On such a platform, a decision support model incorporated Fuzzy Analytical Hierarchy Process and LCCA for the evaluation of the specific cost components most concerned by infrastructure stakeholders. Two real highway infrastructure projects in Australia were then used for testing, application and validation, before the decision support model was finalised. Improved industry understanding and tools such as the developed model will lead to positive sustainability deliverables while ensuring financial viability over the lifecycle of highway infrastructure projects.

Developing a life-cycle costing analysis model for sustainability enhancement in road infrastructure project

With increasing pressure to provide environmentally responsible infrastructure products and services, stakeholders are putting significant foci on the early identification of financial viability and outcome of infrastructure projects. Traditionally, there has been an imbalance between sustainable measures and project budget. On one hand, the industry tends to employ the first-cost mentality and approach to developing infrastructure projects. On the other, environmental experts and technology innovators often push for the ultimately green products and systems without much of a concern for cost. This situation is being quickly changed as the industry is under pressure to continue to return profit, while better adapting to current and emerging global issues of sustainability. For the infrastructure sector to contribute to sustainable development, it will need to increase value and efficiency. Thus, there is a great need for tools that will enable decision makers evaluate competing initiatives and identify the most sustainable approaches to procuring infrastructure projects. In order to ensure that these objectives are achieved, the concept of life-cycle costing analysis (LCCA) will play significant roles in the economics of an infrastructure project. Recently, a few research initiatives have applied the LCCA models for road infrastructure that focused on the traditional economics of a project. There is little coverage of life-cycle costing as a method to evaluate the criteria and assess the economic implications of pursuing sustainability in road infrastructure projects. To rectify this problem, this paper reviews the theoretical basis of previous LCCA models before discussing their inability to determinate the sustainability indicators in road infrastructure project. It then introduces an on-going research aimed at developing a new model to integrate the various new cost elements based on the sustainability indicators with the traditional and proven LCCA approach. It is expected that the research will generate a working model for sustainability based life-cycle cost analysis.

Measuring costs of sustainability issues in highway infrastructure : perception of stakeholders in Australia

With increasing pressure to deliver environmentally friendly and socially responsible highway infrastructure projects, stakeholders are also putting significant focus on the early identification of financial viability and outcomes for these projects. Infrastructure development typically requires major capital input, which may cause serious financial constraints for investors. The push for sustainability has added new dimensions to the evaluation of highway projects, particularly on the cost front. Comprehensive analysis of the cost implications of implementing place sustainable measures in highway infrastructure throughout its lifespan is highly desirable and will become an essential part of the highway development process and a primary concern for decision makers. This paper discusses an ongoing research which seeks to identify cost elements and issues related to sustainable measures for highway infrastructure projects. Through life-cycle costing analysis (LCCA), financial implications of pursuing sustainability, which are highly concerned by the construction stakeholders, have been assessed to aid the decision making when contemplating the design, development and operation of highway infrastructure. An extensive literature review and evaluation of project reports from previous Australian highway projects was first conducted to reveal all potential cost elements. This provided the foundation for a questionnaire survey, which helped identify those specific issues and related costs that project stakeholders consider to be most critical in the Australian industry context. Through the survey, three key stakeholders in highway infrastructure development, namely consultants, contractors and government agencies, provided their views on the specific selection and priority ranking of the various categories. Findings of the survey are being integrated into proven LCCA models for further enhancement. A new LCCA model will be developed to assist the stakeholders to evaluate costs and investment decisions and reach optimum balance between financial viability and sustainability deliverables.

100% pure New Zealand

Tourism New Zealand (TNZ) is the national tourism office responsible for coordinating international marketing of New Zealand as a tourism destination (see www.newzealand.com ). Typical of most destination marketing organisations (DMO), TNZ is funded by government to work with the private sector in an effort to improve the financial viability of the tourism industry. A competitive tourism industry can provide a number of economic and socio-cultural benefits to a community, such as increased job opportunities and lower unemployment, new amenities and attractions, and revival of indigenous culture.

Importance of sustainability-related cost components in highway infrastructure : perspective of stakeholders in Australia

Highway infrastructure development typically requires major capital input. Unless planned properly, such requirements can cause serious financial constraints for investors. The push for sustainability adds a new dimension to the complexity of evaluating highway projects. Finding environmentally and socially responsible solutions for highway construction will improve its potential for acceptance by the society and in many instances the infrastructure's life span. Even so, the prediction and determination of a project's long-term financial viability can be a precarious exercise. Existing studies in this area have not indicated details of how to identify and deal with costs incurred in pursuing sustainability measures in highway infrastructure. This paper provides insights into the major challenges of implementing sustainability in highway project development in terms of financial concerns and obligations. It discusses the results from recent research through a literature study and a questionnaire survey of key industry stakeholders involved in highway infrastructure development. The research identified critical cost components relating to sustainability measures based on perspectives of industry stakeholders. All stakeholders believe sustainability related costs are an integral part of the decision making. However, the importance rating of these costs is relative to each stakeholder's core business objectives. This will influence the way these cost components are dealt with during the evaluation of highway investment alternatives and financial implications. This research encourages positive thinking among the highway infrastructure practitioners about sustainability. It calls for the construction industry to maximise sustainability deliverables while ensuring financial viability over the life cycle of highway infrastructure projects.

Managing cost implications for highway infrastructure sustainability

Highway construction works have significant bearings on all aspects of sustainability. With the increasing level of public awareness and government regulatory measures, the construction industry is experiencing a cultural shift to recognise, embrace and pursue sustainability. Stakeholders are now keen to identify sustainable alternatives and the financial implications of including them on a lifecycle basis. They need tools that can aid the evaluation of investment options. To date, however, there have not been many financial assessments on the sustainability aspects of highway projects. This is because the existing life-cycle costing analysis (LCCA) models tend to focus on economic issues alone and are not able to deal with sustainability factors. This paper provides insights into the current practice of life-cycle cost analysis, and the identification and quantification of sustainability-related cost components in highway projects through literature review, questionnaire surveys and semi-structured interviews. The results can serve as a platform for highway project stakeholders to develop practical tools to evaluate highway investment decisions and reach an optimum balance between financial viability and sustainability deliverables.

Three of a kind? The special case of Australia's Island Councils

In common with many other countries, Australian local government policymakers have focussed heavily on improving financial sustainability and operational efficiency through structural change and other modes of systemic reform. However, this system-wide approach cannot adequately deal with small island councils due to their sui generis characteristics. In an effort to fill this gap in the literature, this article examines the financial sustainability of Australia’s three island councils – Flinders, Kangaroo and King – over the period 2008–2013 in order to determine whether alternative organisational arrangements may be better suited to their unique circumstances. In so doing, our study contributes to the literature by providing the first empirical analysis of the financial viability of Australia’s island councils while considering the need for an alternative organisation entity in an effort to enhance their long-term financial sustainability.

A model for determining the optimal project life span and concession period of BOT projects

The concession agreement is the core feature of BOT projects, with the concession period being the most essential feature in determining the time span of the various rights, obligations and responsibilities of the government and concessionaire. Concession period design is therefore crucial for financial viability and determining the benefit/cost allocation between the host government and the concessionaire. However, while the concession period and project life span are essentially interdependent, most methods to date consider their determination as contiguous events that are determined exogenously. Moreover, these methods seldom consider the, often uncertain, social benefits and costs involved that are critical in defining, pricing and distributing benefits and costs between the various parties and evaluating potentially distributable cash flows. In this paper, we present the results of the first stage of a research project aimed at determining the optimal build-operate-transfer (BOT) project life span and concession period endogenously and interdependently by maximizing the combined benefits of stakeholders. Based on the estimation of the economic and social development involved, a negotiation space of the concession period interval is obtained, with its lower boundary creating the desired financial return for the private investors and its upper boundary ensuring the economic feasibility of the host government as well as the maximized welfare within the project life. The outcome of the new quantitative model is considered as a suitable basis for future field trials prior to implementation. The structure and details of the model are provided in the paper with Hong Kong tunnel project as a case study to demonstrate its detailed application. The basic contributions of the paper to the theory of construction procurement are that the project life span and concession period are determined jointly and the social benefits taken into account in the examination of project financial benefits. In practical terms, the model goes beyond the current practice of linear-process thinking and should enable engineering consultants to provide project information more rationally and accurately to BOT project bidders and increase the government's prospects of successfully entering into a contract with a concessionaire. This is expected to generate more negotiation space for the government and concessionaire in determining the major socioeconomic features of individual BOT contracts when negotiating the concession period. As a result, the use of the model should increase the total benefit to both parties.

In the bank or on the ground : an examination of financial reserves in Australian international aid organisations

This study contributes to the understanding of the contribution of financial reserves to sustaining nonprofit organisations. Recognising the limited recent Australian research in the area of nonprofit financial vulnerability, it specifically examines financial reserves held by signatories to the Code of Conduct of the Australian Council for International Development (ACFID) for the years 2006 to 2010. As this period includes the Global Financial Crisis, it presents a unique opportunity to observe the role of savings in a period of heightened financial threats to sustainability. The need for nonprofit entities to maintain reserves, while appearing intuitively evident, is neither unanimously accepted nor supported by established theoretic constructs. Some early frameworks attempt to explain the savings behaviour of nonprofit organisations and its role in organisational sustainability. Where researchers have considered the issue, its treatment has usually been either purely descriptive or alternatively, peripheral to a broader attempt to predict financial vulnerability. Given the importance of nonprofit entities to civil society, the sustainability of these organisations during times of economic contraction, such as the recent Global Financial Crisis, is a significant issue. Widespread failure of nonprofits, or even the perception of failure, will directly affect, not only those individuals who access their public goods and services, but would also have impacts on public confidence in both government and the sectors’ ability to manage and achieve their purpose. This study attempts to ‘shine a light’ on the paradox inherent in considering nonprofit savings. On the one hand, a public prevailing view is that nonprofit organisations should not hoard and indeed, should spend all of their funds on the direct achievement of their purposes. Against this, is the commonsense need for a financial buffer if only to allow for the day to day contingencies of pay rises and cost increases. At the entity level, the extent of reserves accumulated (or not) is an important consideration for Management Boards. The general public are also interested in knowing the level of funds held by nonprofits as a measure of both their commitment to purpose and as an indicator of their effectiveness. There is a need to communicate the level and prevalence of reserve holdings, balancing the prudent hedging of uncertainty against a sense of resource hoarding in the mind of donors. Finally, funders (especially governments) are interested in knowing the appropriate level of reserves to facilitate the ongoing sustainability of the sector. This is particularly so where organisations are involved in the provision of essential public goods and services. At a scholarly level, the study seeks to provide a rationale for this behaviour within the context of appropriate theory. At a practical level, the study seeks to give an indication of the drivers for savings, the actual levels of reserves held within the sector studied, as well as an indication as to whether the presence of reserves did mitigate the effects of financial turmoil during the Global Financial Crisis. The argument is not whether there is a need to ensure sustainability of nonprofits, but rather how it is to be done and whether the holding of reserves (net assets) is an essential element is achieving this. While the study offers no simple answers, it does appear that the organisations studied present as two groups, the ‘savers’ who build reserves and keep ‘money in the bank’ and ‘spender-delivers’ who put their resources ‘on the ground’. To progress an understanding of this dichotomy, the study suggests a need to move from its current approach to one which needs to more closely explore accounts based empirical donor attitude and nonprofit Management Board strategy.

How do customers of a financial services institution judge its communications

Communications are important for relationships within a marketing channel from both a theoretical and managerial perspective. Yet it is a problematic area for scholars. Thus, this research addresses the problem of how do customers of a financial services institution perceive communications with an ideal institution? This study's case research methodology used in-depth interviews with 34 carefully selected customers of a building society. The factors that make up customers' attitudes about corporate communications for an ideal financial services institution were identified and actual perceptions were compared against that ideal. The findings confirmed the importance of communications for customers in a relationship with a financial services provider and suggested communication priorities for customers in this context. In addition, the findings suggested sources of communication dissatisfaction for customers. These findings build upon the literature that speculates about customer perceptions of communications with organizations but provides little evidence to support hypotheses. The contributions arose from the emphasis on the customers' own attitudes and the patterns found within them.