Roads benchmarking 2021
Our 2021 road benchmarking spreadsheet has now been completed. This is the fourth year in a row from 2018 when we first started to collect and publish information about NSW councils’ road unit rates.
Our spreadsheet summarises data about each NSW council’s road gross replacement cost per kilometre. This information is calculated based on the open financial reports published by councils, NSW Office of Local Government and Transport for NSW.
The main purpose of the spreadsheet is to give a simple tool for comparison of road unit rates between councils. This is a great benchmarking tool which can support councils in a yearly assessment of fair value of their road network; perform internal desktop revaluation of roads; or critically review valuations performed by external valuers.
The spreadsheet is available on this link ->> Roads benchmarking 2021.
Some findings are summarised below.
Valuer
Since 2015, about 50% of all councils performed revaluation of roads internally. About 12% did it utilising both internal and external expertise. The rest 38% engaged an external valuer.
External valuers and asset management consulting firms (which are usually hired to perform robust analysis of condition) were represented by following companies: APV, AssetVal, JRA, Shepherd Asset Management Solutions, Infrastructure Management Group Pty Ltd, EMC-Works, G7 Asset Management, Infrastructure Management Group, Talis Consulting, Civil Engineering Consultants, Pavement Management Services.
Even with the independent valuation, council should still take control over the revaluation process to ensure deliverables from the valuer meet audit, financial reporting and internal management requirements. Benchmarking tools can be very handy in this process.
Unit Rates
By aggregating all unit rates into groups ($’000/km), some interesting results can be derived.
Sealed roads
As at 30 June 2021, about 46 councils have the largest unit rates for sealed roads (>$400k per km). However, this is a significant drop in numbers from previous year. Indeed, last year we had 63 councils reporting sealed roads unit rates in a group “>$400 per km”. Summary of all councils presented in the graph below.
Unsealed roads
32 councils’ unsealed road rates are within $0k-$50k per one kilometre; 21 councils are in the next group of $50-$100k per one kilometre. The two groups combined comprise half of all councils. Unfortunately, we could not find out details for unsealed roads values of about 52 councils which are in a “N/A” group. More details available in a graph below.
Bulk earthworks
There is some uncertainty about 47 councils which did not disclose value of road earthworks in their financial statements or in Special Schedule 7 (because they were combined with the roads values). However, we know that a large group (25 councils) applied unit rate of less than $50k per km; and 19 councils used a rate in between $50 and $100k per km. See details in the graph below.
Contact us
Vanguard provides services for fair value assessment, desktop revaluation of roads as well as coordination of external revaluation of all classes of infrastructure assets. Contact us any time to discuss your needs. We are here to help!