COVID-19 Business Continuity – no Playbook

Business Continuity for Councils during COVID-19 Pandemic

Introduction

Escalation of COVID-19 protocols has seen the introduction of social distancing and lockdown measures to prevent the spread of the coronavirus. Prime Minister Scott Morrison said in a statement “Australians should expect these measures to be in place for at least six months”. Since that time Premiers have made daily announcements on social distancing and lockdown measures to restrict the movement of our communities and reduce person-to-person contact.

Most of Australia’s COVID-19 positive cases have been contracted abroad including many who have returned from cruise ships. Community transfer, to this point in time, has been minimal due to the success of lockdown and social distancing measures introduced by State Governments.

This pandemic crisis has come on the back of drought, fires and floods, which have decimated some regional, rural and remote communities across Australia. Many Councils fatigued by disaster and recovery, and with limited funds, are now finding themselves in the middle of another storm as they withdraw services, close facilities and stand down staff as a direct response to escalating COVID-19 protocols.

Once the social distancing protocols were announced, Councils had no choice but to act on their occupational health and safety obligations to ensure staff and community safety.

Governance Arrangements

COVID-19 has caused disruption to Council operations and governance arrangements including Council meetings. To this end Councils have moved to delegate additional powers to their CEOs to see out this crisis and ensure business continuity.

While some Councils have continued to meet in larger venues to enable observation of social distancing protocols, others have moved to conducting online meetings where enabled by local legislation. Many Council agendas have been trimmed back to enable due consideration of essential business continuity matters.

Withdrawal of Services and Closure of Facilities

To manage the growing risk of COVID-19, Councils moved swiftly to reduce person-to-person contact by cancelling/postponing events and gatherings and withdrawing non-essential services such as:

• libraries;
• community centres and halls;
• recreation centres, gymnasiums and swimming pools;
• Visitor Information Centres; and
• Art Galleries and Performing Arts Centres.

Customer Service Centres

Customer service centres have been closed by some Councils and the community has been encouraged to transact their business with Council by phone, email and via their websites. Where customer service centres remain open, community members have been asked to observe COVID-19 protocols including:

• hygiene and social distancing;
• if community members are feeling unwell, they should not enter the facility; and
• if community members have recently returned from overseas, they should not enter the facility.

Essential Services

Councils continue to deliver essential services, including most of the following, depending on where they are located:

• water and sewer;
• collection and management of waste;
• development assessments;
• roadworks and repairs;
• public realm/street cleaning;
• local laws/rangers;
• childcare; and
• public toilets.

Aged and Vulnerable

Councils have prioritised resources to providing care and support for the aged and the most vulnerable in their community. The services delivered to the aged and vulnerable vary across the country and may comprise meals-on-wheels, personal care/hygiene, medication prompting, shopping and assistance with rubbish bins.

Beach Closures

Some Councils have had to move to close some of their beaches, parks and playgrounds because they were attracting crowds and becoming a health risk. Fencing was erected around some of Australia’s most iconic beaches to stop gatherings and the breaching of social distancing rules. This included high profile beaches such as Bondi, Manly, Byron Bay, Surfers Paradise, Coolangatta, Noosa, St Kilda and Phillip Island. Fremantle and Cottesloe remain open as long as social distancing restrictions continue to be observed.

While some beaches remained open for locals to exercise, day-trippers and holiday makers were being discouraged with closure of beach carparks. Failing to comply with the strict isolation/social distancing restrictions may attract a fine as much as $1,652 depending on State enforcement.

Working from Home

Councils unable to facilitate appropriate social distancing and provide a safe working environment have taken steps to send at least some staff home. Unfortunately, most Councils do not have the capacity for all staff to meaningfully and productively work from home. Councils are using the coming weeks/months to build capacity of their systems and technology to increase the number of staff working from home.

Those Councils that have invested in technology that enables remote working have a head start on deploying staff from home and delivering services to the community safely.

Flexible Working Arrangements

For years Council employees have been looking for more flexible working arrangements, urging their employers to enable them to work from home. For many it’s been a difficult process resulting in one or two days per week remote working. Some of the lucky ones have had a better result. These pioneers challenged organisational policies and procedures that were developed and adopted in a pre-digital world.

Moving towards more flexible working arrangements needs to be formalised as a strategic imperative for the business of Council and adopted accordingly. Only then will working from home be recognised and resourced adequately to enable rollout across the organisation. Let’s hope much of this can be achieved as a direct response to the COVID-19 crisis.

Leave Entitlements

Some staff have been stood down with pay (2 to 4 weeks) while others are being paid their leave entitlements. A range of leave arrangements are being used at this time to tie staff over:

• following in the footsteps of some State Governments, some Councils are paying staff COVID Leave/Special Leave;
• allowing staff to draw down Annual Leave and Long Service Leave entitlements, with the option of taking leave at half pay;
• allowing staff to bring forward access to their 2021 Annual Leave, with the option of taking leave at half pay;
• allowing staff access to Sick Leave/Special Leave in case of need for testing/self-isolation; and
• where staff leave is exhausted, Councils may require staff to take leave without pay.

Casual Staff

Many Councils have indicated their casual staff numbers cannot be maintained. Having paid their casuals between two and four weeks, some Councils have applied the stand down provisions to their casual workforce.

Most Councils do not have the financial reserves to provide for retention of casual or permanent staff associated with closed facilities where user charges have plummeted.

Local Government Unions

Various Unions with local government coverage have not been impressed with Councils standing down staff. Unions have taken action against Councils that have been quick to stand down staff, across a number of jurisdictions. The Unions are calling for a sector-wide approach to this crisis and how Councils deal with their workforce.

Councils are faced with the challenge of providing a safe work environment while staying afloat. For many, carrying a full staff complement for six months is clearly not an option.

Councils Introduce Hardship Support

Councils are experiencing significant impact on revenue as householders and businesses struggle to deal with the pandemic reality. The last thing they are thinking about is paying Council rates on time.

There have been suggestions that Councils should waive rates for residents and businesses doing it hard. While Councils do not have the capacity to waive rates across the board, some have introduced financial support options for landowners and businesses who may be unable to pay their rates due to the COVID-19 pandemic.

Financial Pressures

Many regional, rural and remote Councils still recovering from drought, fires and floods are in no financial position to cope with the impact of a pandemic. Financial pressures on Councils have been extreme as they juggle priorities:

• redeployment of staff rather than standing down staff;
• maintain a pipeline of capital works/major projects;
• freeze rates and charges;
• waive fees for parking and planning/building applications;
• provide hardship strategies for businesses/households unable to pay their rates; and
• upgrade IT systems to enable greater working from home.

Support for Local Government

The PM has confirmed that the JobKeeper Program will not extend to Councils despite approaches from various Local Government Ministers and Local Government Associations. As a major employer with almost 200,000 employees nationally it’s in everyone’s best interest to ensure they remain employed. ALGA has estimated that some 45,000 jobs could be lost as Councils stand down staff.

Much is being asked of local Councils yet there has been little support. We may find that some Councils will not be able to continue to provide essential services without some State/Federal Government support. Regional Councils whose economies were devastated by recent fires and floods are calling on Governments for assistance with the COVID-19 crisis.

Same, Same but Different – the Federation

State Governments have been quick to realise that the coronavirus moves at a different pace across the country, which requires tailored strategies and responses around social distancing and locking down community activity. Therefore, there has been some variation in measures applied by the State Governments as they relate to schooling, reasons for being out of your home and fines/enforcement.

The more populous states had to execute greater measures to isolate communities as much as possible by locking down borders and keeping travel/movement of people to a minimum.

Building Organisations for a Digital Future

COVID-19 has been a disruptor like no other exposing many gaps in our systems and approaches and highlighted the need to build organisations for a digital future. Councils need to rewrite their business rules for a digital world, and some may need to skip generations of business processes, systems and technology to catch-up to 2020 – starting with online Council meetings!

Our jurisdictions are scrambling to pass legislation that enable virtual/online meetings of Council. Let’s hope the new laws are designed to enable Councils to transition to a digital world rather than merely mimicking today’s analogue processes and practices.

Global Coronavirus Impact

The spread of COVID-19 globally has now resulted in some 2.7 million infections and 190,000 deaths. As countries implement necessary quarantine and social distancing practices to contain the pandemic, the world around us has been put into lockdown. The magnitude and speed of collapse in activity that has followed is unlike anything experienced in our lifetimes.

In mid-April, the International Monetary Fund projected in its World Economic Outlook that the global economy would contract 3% in 2020.

Advice from global business advisors is to separate out essential operations and services, focusing on high-priority customers and clients, and implementing operational and financial preparations consistent with a two-to-three-quarter recession.

Domestic Impact

Australia is likely to experience the greatest economic contraction since the Great Depression, according to the Reserve Bank of Australia (RBA), and has already lost 800,000 jobs and suffered a 6.7% reduction in take-home pay, according to the Australian Bureau of Statistics.

RBA provided an economic update predicting a 10% decline in national output in the first half of 2020, a “staggeringly large” 20% reduction in hours worked and unemployment to hit 10% by June.

The RBA showed some optimism by suggesting if restrictions are eased by mid-year, and most are lifted by year’s end, except for the ban on international travel, GDP could grow by 6% to 7% in 2021. It is anticipated that the Federal Government and more particularly the State Governments will respond with significant stimulus packages to kick off the economic recovery and job creation.

As we flatten the curve and the daily case numbers continue to fall, pressure will be on for life to return to normal, whatever that may look like, in order to reignite the domestic economy and employment. Recent experience from Singapore has shown that we cannot wind back the restrictions too soon as that may result in increased infections.

Conclusion

As they ready themselves to cope with the impact of COVID-19 Councils need to be considering the following:

Governance Arrangements

To enable business continuity and timely decision-making, Councils need to review their governance arrangements. This may result in additional delegations to the executive and introduction of online council meetings.

Service Delivery

To enable business continuity and effective delivery of essential services, Councils need to monitor:

• demand for services;
• effectiveness of service delivery and compliance with various COVID-19 protocols;
• stresses and strains on staff delivering services;
• health impact and availability of staff; and
• emerging community needs.

Reinstating services and reopening facilities will primarily be driven by the relaxation of COVID-19 protocols by the Federal and State Governments.

Working from Home

Enabling staff working from home to be productive will be a challenge for many Councils and not all of it will be a systems/technology challenge.

Councils need to take this opportunity to progress their remote working arrangements and consider what investment needs to be made in systems/technology as well as management and supervisor training.

Financial Pressures

Councils need to take steps to review their short/long term financial plans and account for the foreseeable impact of COVID-19 on their income and expenditure. This may require some scenario modelling to identify the most likely outcome. Councils may also need to address short to medium term funding gaps with loans or reallocation of existing reserves.

This makes for interesting budgeting preparations as Councils take a more conservative approach to revenue estimates and consideration of COVID-19 response and recovery demands on expenditure.

Digital Future

Failing to grasp the digital transformation challenge at this time may result in increased health risks for staff and community. Now is not the time to avoid the difficult decisions around digitising services. Councils need to effectively deliver services to their communities without any risk to staff or community. This can best be achieved by digitising their service delivery. The benefits of investment in digitising services will be lasting, well beyond COVID-19.

By John Ravlic, 16 April 2020