Until the creation of the LGPI, productivity was not measured in the Local Government sector. The absence of a reliable and accurate measurement of productivity for Councils, makes it difficult for regulators, custodians, and their communities to gauge an enterprise’s operating performance over time and to recognise and reward improvement.
To calculate the productivity of an enterprise, the actual values of the outputs produced by the enterprise are divided by the actual values of the inputs consumed by the enterprise to determine the enterprise productivity.
The productivity formula for any period is: Productivity = Outputs / Inputs
Exclusions for Councils in local government include borrowings costs, depreciation, grants and contributions are excluded from the LGPI.
The index incorporates the outputs and inputs data from 2015 - 2019. This is a simple way to know the which Council has been improving their operational expenditures vs their revenues. Overtime you can see how they have either improved or declined in productivity. This can be used across all local government.
After downloading the document you can select your Council and see their results. Using the formula of 1 = the Council costs are at even to their revenues. For example if a result is 1.10 they are earning more than their costs. Anything less than 1 means it is costing them more in comparison to what they earn through services.