Case study 3.8

Asset management for public entities: Learning from local government examples.

Upper Hutt City Council – Being clear about the minimum condition that is acceptable, even if the assets are still serviceable, helps meet the local community's expectations

Five-point scales for recording the condition of assets are well used by councils across the country. The International Infrastructure Management Manual⁴ includes guidance on a number of such scales. Most councils focus their renewal efforts on assets at condition ratings four and five. Upper Hutt has gone further. The Parks and Reserves Plan sets out a defined five-point scale for grading asset condition. However, the Council has decided that the lower condition ratings are unacceptable for assets in the city's parks. "The asset condition rating of fair (3) has been identified as the acceptable minimum asset condition for Upper Hutt Parks and Reserves."

Upper Hutt City Council’s five-point scale for grading the condition of parks and reserves assets

0	Non-existent – Asset absent or no longer exists.
1	Excellent – Asset in sound physical condition designed to meet current standard. No work required.
2	Good – Acceptable physical condition but not designed to current standards or showing signs of wear. Wear has minimal impact on asset performance. Only minor work required.
3	Fair – Functionally sound but showing some wear with minor failures and some deterioration in performance. Minor components or isolated sections need repair or replacement.
4	Poor – Asset functioning but requiring a high level of maintenance to remain operational. Likely to cause a marked deterioration in performance in short term. Substantial work required.
5	Very poor – Failed or failure imminent. Asset life effectively exceeded and excessive maintenance costs incurred. Major work or replacement required urgently.

4: National Asset Management Steering Group, Association of Local Government Engineering NZ Inc (2006) 3rd edition (Version 3.0), International Infrastructure Management Manual, National Asset Management Steering Group, Association of Local Government Engineering NZ Inc. (INGENIUM), pages 3.44–3.45.