Appendix 1: Recommendations in our 2006 report

Managing the school property portfolio.

We last reviewed school property management in 2006. We focused on:

  • the effectiveness of organisational arrangements;
  • strategic management of the school property portfolio; and
  • overseeing capital projects and maintenance.

The areas of focus in our 2006 report remain relevant today. However, the Ministry managed school property in a different environment in 2006. There have been substantial changes since 2006 in how the Ministry operates. The main difference, and the major exposure to risk in the sector in 2006, was the extent of capital projects managed directly by schools.

Many of the matters raised in 2006 have been partly addressed. We consider the steps taken in the last four to five years by the Ministry (particularly Infrastructure Services) are positive, but there are still opportunities for improvement.

2006 recommendationComments on 2016 position
(1) Effectiveness of organisational arrangements
1. ... that the Ministry devise common goals for managing school property within the organisation, to ensure that policy objectives are translated into operations performance targets. The Ministry took a significant step to meeting this expectation through the Ministry's 2011-2021 School Property Strategy, which set out a vision and goals for school property. The strategy included performance measures but did not directly link to the broader Ministry's strategy. We have not seen consistent monitoring and external reporting on the performance measures and goals.

The Ministry is developing a new strategy to continue to focus Infrastructure Services' development as an asset manager. The new strategy will collectively consider the outcomes for school property, transport, ICT infrastructure, and education payroll services. However, key Infrastructure Services documents still need to be linked to the broader strategy of the Ministry.
2. ... that the Ministry identify the main expectations of Network Development Officers and Network Facilitators nationally and ensure that these are reflected in their job descriptions. School Property Advisors (Ministry Advisors) now work in Infrastructure Services, with a focus on ensuring that school property in their regional portfolio is maintained and sustained. They also look to co-ordinate the efforts of nationally led work through working alongside capital works teams based in regional offices.

Regional staff work closely with network management staff from Sector Enablement and Support Group. All business cases for capital work include demographic and other operational considerations.

We received feedback from some schools interviewed that the portfolios managed by Ministry Advisors were too large, and a significant portion of the schools interviewed believed their Ministry Advisor did not visit often enough.
3. ... that the Ministry introduce documented business processes for Network Development Officers and Network Facilitators that define responsibilities and record keeping requirements and that are subject to quality control.
4. ... that the Ministry review the training needs of Network Development Officers and Network Facilitators in property management and introduce a formal training programme, including induction training for new staff and ongoing training for existing staff. Ministry Advisors can call on a range of tools and templates to help them fulfil their roles.

Schools depend on contracted project managers and property planners who manage school-led property projects and prepare School Property Plans. Recent improvements have seen the Ministry setting up provider panels and basic training and experience requirements for property planners. Although schools still have significant input into the appointment of property planners and project managers, the Ministry is taking steps to ensure that they meet important quality criteria.
5. ... that the Ministry regularly evaluate and review training provided to school Boards of Trustees and principals in school property management, to ensure that the training is sufficient and relevant. Significant amounts of material is available to school boards and principals. Newly appointed principals and school boards are eligible to attend Ministry-funding training programmes. However, comments from our school interviews were that the training is inadequate, does not explore key risks in-depth, and does not suitably equip new principals and Board members for the challenges of property. This increases the dependency on property planners and project managers.
6. ... that the Ministry actively encourage schools to share facilities and jointly contract for capital and maintenance work. Although we were told about some trials of joint-contract relationships, either Ministry-led or co-ordinated by the Ministry, there has been no significant progress. The nature of school property funding does not encourage this behaviour and the condition of school property varies.

There are some examples in the sector where schools seek to co-fund with the Ministry special educational facilities, using community-raised funds. However, this is not often carried out as a community of schools.

The new Communities of Learning, although set up to improve educational outcomes for a range of schools in a community, could lead to enhanced relationships from a property perspective that will maximise the benefits of key property investments in several schools. The Ministry is considering how property funding can be managed through Communities of Learning.
(2) Strategic management of the school property portfolio
7. ... that the Ministry produce a strategic plan for school property management that is clearly linked to the Ministry's wider education aims, including its vital outcomes. The Ministry produced a 2011-2021 School Property Strategy. This clarified the vision and goals for school property. However, it remains disconnected from broader Ministry planning documents. The potential risk is that Infrastructure Services prepares strategies ahead of the Ministry's planning documents. The Ministry's Four Year Plan and its "Plan on a Page" do not give any material reference to the significance of school property in providing an effective learning environment for students.
8. ... that the Ministry explicitly link delivery targets included in the Education and Improvement Support Annual Plan to aims and objectives in the school property management strategic plan. Significant changes have occurred to key accountability documents since 2006. However, we continue to note that there is no consistent flow of performance information from Infrastructure Services' reporting and planning to Ministry-level documents and objectives. The Ministry has taken steps in recent years to improve the school property-related measures in its broader reporting documents. These have not yet been successful. Although progress has been made for the 2016/17 year, publicised measures need to have effective targets.
9. ... that the Ministry, as part of its strategic planning for school property management, identify performance targets to use as a basis for measuring the achievement of objectives and outcomes.
10. ... that the Ministry arrange regular independent validations of information held in the Property Management Information System (PMIS), and introduce consistent internal procedures for checking data. Helios replaced PMIS from 4 April 2016. Helios will allow better collection of information about school property assets.

Before its replacement, PMIS mainly held financial information, with other databases holding asset condition information. PMIS data was updated on a project basis and through the ad hoc data updates from across the network. Now, school property consultants update the school property condition database at least once every five years as a part of the initial asset condition stocktake associated with School Property Plans.
11. ... that the Ministry determine how to improve systems that are used to hold information about property so that it has a better overview of the entire school property portfolio, to assist it in planning and making decisions about property at a portfolio level. Property information is still drawn together from several sources. Although Helios has replaced PMIS, and the Ministry can access portfolio-level data from the database holding asset condition information, this is not used for decision-making. Helios and the Oracle Fixed Asset Register now keep asset age and financial information for every project, open (incomplete) or closed (complete).

Despite these challenges, projects are reported on using data from various sources and appears robust and effective for programme management.
12. ... that the Ministry determine how to improve the integration of property information with its financial management system. The property management system (Helios) is reconciled with the Ministry's financial systems, but there remains no direct integration between the property condition information and the financial management systems.

Information on forecast school-led capital projects funded by Five-Year Agreement funding is maintained within School Property Plans. However, there is no central summary of these documents showing the Ministry the projects that are planned across the four priorities of projects used in school property planning.
13. ... that the Ministry, in determining targets for the disposal of surplus school property, identify separate targets for property that can be disposed of quickly and for property that will take longer to dispose of because of specific complications it has identified. The Ministry, with many other Crown agencies, has moved to using LINZ for selling surplus property. Although the sales process can still take some time due to legislative restraints and Treaty of Waitangi settlement responsibilities, we have not noted any concerns.

The main aspect in need of attention is identifying under-used school teaching spaces, which cost money to maintain and renew. Although demand and demographic changes can result in the need to provide more classrooms in parts of the country, in others school rolls are declining.
(3) Overseeing capital projects and maintenance
14. ... that the Ministry extend its overseeing of capital projects to include reviews of completed projects that determine both their effect on the overall condition of the school property portfolio and their broader contribution to the achievement of its strategic objectives for property and vital outcomes. The Ministry is significantly closer to assessing the effect that capital projects can have on schools than it was 10 years ago. For large projects, the Ministry carries out Post Occupancy Evaluations. These detailed reviews mainly focus on the site and building design and highlight physical design attributes that are important to what is considered to be a Modern Learning Environment. However, we note that:
  • The Ministry carried out only three post-occupancy reviews in 2016.
  • There is limited assessment on what is successful from an educational outcome perspective.
15. ... that the Ministry identify the main risks for network provision staff to consider when determining whether a school should be required to appoint a professional project manager to manage capital projects, and review its policy to enable these risks to be taken into account as well as existing financial thresholds. Schools need to appoint a suitably qualified external project manager for all school-led projects. The Ministry manages all significant capital projects outside this programme, using in-house capability and contracted professional expertise. Role clarity is an issue.
16. ... that the Ministry encourage all schools to improve the economic and environmental performance of their property by requiring them to calculate the whole-of-life costs of capital projects. Schools classify all property projects within the four priority project groups as part of the agreement with the Ministry on how they will spend their Five-Year Agreement funding. Schools cannot start projects with Ministry funding without Ministry approval, as a part of the School Property Plan. Each plan clearly outlines the need for the project and the desired result.

The Ministry now has an Investment Board, which includes members from various parts of the Ministry. The Board reviews and approves detailed business cases for all major projects.
17. ... that the Ministry monitor how schools are spending their maintenance funding to identify schools that are significantly under-spending, and to ensure that it achieves value for money. This remains a weakness. No statistical evidence is available about the nature and extent of maintenance spending. The Ministry relies on condition assessments and the proportion of work in each school's property plan that falls within the first two priorities of work, P1: Health & Safety, and P2: Essential Infrastructure. However, the Ministry does not collate this information from School Property Plans.
18. ... that the Ministry continue to monitor the suitability of its formulas for allocating maintenance funding to schools to ensure that all schools have sufficient funding to maintain their property in a good state of repair. The Ministry is reviewing the funding for the schools sector.

The Ministry has not carried out any recent reviews of the formulas for allocating maintenance funding.
19. ... that the Ministry ensure that the pilot audit of schools' maintenance (or another mechanism) provides adequate information about the condition of school property. The Ministry does not carry out audits of school maintenance. The last major initiative to collect school property information was the nationwide condition assessment in 2011, which was the basis for the school property condition information database. Property planners update this condition information every time a new School Property Plan is agreed.

The Ministry has carried out some sample audits of school property information to support PMIS data, such as a 2016 review of Site Improvements at schools and recent reviews of school size data.
20. ... that the Ministry determine how the results of the audit of schools' maintenance will be recorded, assessed, and acted upon. Ideally the results would be recorded within the Property Management Information System (PMIS). The Ministry does not carry out audits of schools maintenance.

The Ministry keeps school condition information in its property condition database but there is no link to the property information in Helios (which replaced PMIS in April 2016).
21. ... that the Ministry, having identified schools that are failing to maintain their property to the required standards, establish the reasons and what action is required to remedy the situation. The Ministry does limited work on this. The general view is that most schools maintain their properties to the extent they can. However, some schools have either far more capacity financially or through community help to carry out maintenance work or school boards or principals who prioritise these matters. Other schools place less emphasis on the physical environment in their school goals or do not have the capacity or capability to maintain their schools property.
22. ... that the Ministry provide guidance and consider other ways in which schools might be encouraged to improve the environmental and economic performance of their school property through decisions they make about maintenance. The Ministry has a lot of guidance available online for schools to access. Our interviews with stakeholders showed that in some situations there is too much guidance or it is not always easy to find.
23. ... that the Ministry introduce monitoring of the selection process used by schools to award contracts for maintenance to ensure that schools comply with its requirements. The Ministry requires a procurement plan for any contract worth more than $50,000 but this guidance is provided for school property projects; it is not clear that it also relates to maintenance contracts. There is no formal monitoring of this process by the Ministry.
24. ... that the Ministry provide guidance to schools about the issues they need to consider, including an assessment of value for money, before entering into long-term maintenance contracts. The Ministry provides advice about property procurement on its website.