The Local Government Association of South Australia collects information on the performance of all Councils as part of its Comparative Performance Measurement Project (CPMP). Sources of this information include a number of government agencies, and a voluntary community survey.
Asset Sustainability Ratio is one of the parameters collected.
It expresses net capital expenditure on renewal and replacement of existing assets as a percentage of the optimal level for such expenditure as shown in a council’s Infrastructure and Asset Management Plan (where the latter level of expenditure is not available for an asset class, depreciation is used as a proxy). Alternatively, a council may choose to calculate this ratio by expressing net capital expenditure on renewal and replacement of existing assets as a percentage of depreciation costs. Either way, this measure can assist in identifying the potential decline or improvement in asset condition and standards. A percentage less than 100 on an ongoing basis indicates that capital expenditure levels are not being optimised so as to minimise whole of life cycle costs of assets (having regard to the Infrastructure and Asset Management Plan) or that assets may be deteriorating at a greater rate than spending on their renewal or replacement.