The rise and rise of shared services
Our shared story
In 1994, local councils across Queensland banded together for the first time to pool capacity and expertise when handling their liability claims.
It was a reasonably inauspicious beginning for an idea which would eventually grow into a multi-million-dollar self-insurance powerhouse, now projected to return $50 million to scheme members over the next decade.
In 2018, the local government sector continues to explore new ways to share and improve on the success of these insurance schemes as a new age of local government dawns.
How did we get here?
- LGM Liability, a mutual self-insurance scheme collectively owned and run by councils, grew into a one-stop shop catering for the contemporary council’s worker insurance, offering unrivalled value.
- The clear savings to council and community costs, time and risk meant that the idea extended to encompass the two schemes that now sit under the single banner of Local Government Mutual Services – LGM Liability, LGM Assets and LGW Workcare.
- Since they began, local government in Queensland has saved over half a billion dollars by having their insurance managed inhouse by specialists JLT.
Where are we now?
In March this year, the LGAQ Board voted to collectively return $5 million per year to both scheme member councils, for such a period of time that material available surpluses exist in the schemes (over and above what is agreed to be an adequate prudential surplus margin).
At this time it is envisaged that annual returns at this level could be sustainable for a decade or more.
It’s a return which offsets the $4.7 million per annum the scheme member councils pay to be a member of the LGAQ.
It means money for councils, communities and the continual improvement of the risk profile of the local government sector.
Looking to the future
The ongoing commitment of Queensland councils to cost stability and service excellence over the past 24 years has culminated in an exciting new phase for local government’s self-insurance schemes.
The LGAQ Board has approved a total of $9 million of surplus funds to be retained to support ground-breaking new initiatives that further reduce council risk.
This is on top of $6 million to fund projects like LG Sherlock, a world first data analytic tool for councils.
Already, LG Sherlock pilot programs conducted in areas like electricity management, barking dogs and asset management are indicating there are big rewards to be reaped from planting the seeds of change - now.
We're also paying tribute to a pioneer - former LGAQ President Noel Playford AM following the announcement of his retirement as Chair of Local Government Mutual Services (LGMS).
Local Government Association of Queensland
LG House, 25 Evelyn Street, Newstead Qld 4006
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