Community planning services in Glenelg Shire Council : 1998-2005 ...

Did the council effectively manage its outsourced planning services? 107
As Figure 5A shows, the roles and responsibilities of the planning
contractor were clearly specified. As we noted in part 4.5 of this report, the
contractual roles and responsibilities were supported by council
delegations 49 issued to the planning contractor. Under these delegations,
the planning contractor, in his role as a council employee, effectively was
assigned the role of council.
5.2.3 Contractual arrangements
In an effectively managed outsourced planning function, we would expect
to see performance-based contractual arrangements. These should clearly
outline the services to be delivered and the rights and responsibilities of
both parties.
There should also be:
a performance management system to monitor and assess the
contractor’s performance
appropriate dispute resolution provisions built into the agreement.
The contract between the council and the planning contractor was a
standard commercial document, similar to that used by other local councils
for their outsourcing arrangements.
The contract adequately outlined the services to be delivered, defined the
commercial relationship between the council and the contractor, and
addressed key contractual risks such as the contractor not meeting
required performance standards, termination of agreements and conflict of
interest.
As the services contracted to external providers increase in size and
complexity, councils are increasingly using performance-based contracts.
These contracts link part of the provider’s fee to the achievement of key
performance targets in order to encourage enhanced performance.
The planning contractor’s contract was performance-based. The annual
amount paid by the council to the contractor for planning services was
based on the contractor achieving specified output targets. There was also
a “variation to workload” agreement. This allowed the contractor’s
monthly payments to be adjusted where the workload varied by more or
less than 10 per cent. Additional amounts were routinely claimed by the
planning contractor for the processing of planning assessments over and
above the contracted levels.
49 Instrument of Delegation by council to members of council staff, January 2004.