How should local water utilities undertake strategic planning?

Jerilderie Billabong Creek, NSW.

From 1 July 2022, the Regulatory and assurance framework for local water utilities PDF, 1613.11 KB applies to local water utilities in regional NSW.

In 2021, we committed to ensuring that those local water utilities progressing their Integrated Water Cycle Management (IWCM) Strategy would not be disadvantaged by the new strategic planning assurance framework. We continue to engage with all local water utilities that are currently undertaking an IWCM Strategy, including those funded under the Safe and Secure Water Program. We will work with utilities individually to develop a clear transition program through to 1 December. We will also publish draft guidance over the coming months, with final guidance in place by October.

We are in the process of updating the Safe and Secure Program guidelines to enable funding for strategic planning using approaches other than IWCM strategies.

While the department sets expectations for the outcomes that strategic planning needs to achieve to be effective and evidence-based, utilities can decide what approach to take to meet them. Generally, the department will not specify the approaches, processes, and tools that a utility should use for strategic planning. Local water utilities are responsible for developing and implementing their own strategic planning. There is no single best-practice way for this work to be delivered, although the department will give ‘how to’ guidance, templates, case studies and tools to facilitate a streamlined process. Our overall priority is to ensure strategic planning outcomes (outlined in Section 3.2 of the Regulatory and assurance framework for local water utilities PDF, 1613.11 KB) are achieved to a reasonable standard.

Local water utilities vary in size, geography, demographics, challenges, and organisational arrangements, which means strategic planning approaches and outputs can be significantly different across regional NSW.

We will give ongoing support to ensure that local water utilities can do planning in a way that will meet the outcomes set by the department. A local water utility can also specifically request advice and support from department staff. In addition, when the department identifies (through data analysis and engagement) that a local water utility may face challenges in its strategic planning activities, we may give support on a proactive basis.

Using the Integrated Planning and Reporting Framework for local water utility strategic planning

The department’s guidance Using the Integrated Planning and Reporting framework for local water utility strategic planning PDF, 573.34 KB is for councils interested in using the Integrated Planning and Reporting (IP&R) framework of the Local Government Act 1993 for local water utility strategic planning.

We will continue to work with interested councils and joint organisations of councils over the next cycle of IP&R (from 1 July 2022 to 30 June 2025) to support pilots using the IP&R framework for local water utility strategic planning. The intention is to learn from these councils and share their knowledge, expertise, and learnings with the sector more broadly through future updates of this guidance. Councils interested in participating in the pilot process should contact the Town Water Risk Reduction Program at

Integrated Water Cycle Management (IWCM) strategies

Prior to 1 July 2022, the department’s preferred approach to local water utility strategic planning was an Integrated Water Cycle Management (IWCM) Strategy. The IWCM Strategy was intended to be the local water utility’s strategic services planning instrument for addressing all water supply and sewerage related priorities and risks and was developed in accordance with New South Wales Government Best-Practice Management of Water Supply and Sewerage Guidelines PDF, 1764.65 KB and the 2019 IWCM Strategy Check List PDF, 761.44 KB.

Local water utilities can choose to continue to use the IWCM Strategy approach to develop strategic planning that is effective, evidence-based strategic planning.

Additional resources that support the IWCM strategy approach to develop strategic planning include:

Other guidance under development

We continue to develop other guidance for local water utility strategic planning. By October 2022 we will have guidance in place for each of the 12 strategic planning outcome areas identified in the Regulatory and assurance framework for local water utilities PDF, 1613.11 KB:

  • Understanding service needs
  • Understanding water security
  • Understanding water quality
  • Understanding environmental impacts
  • Understanding system capacity, capability and efficiency
  • Understanding other risks and challenges
  • Understanding solutions to deliver services
  • Understanding resourcing needs
  • Understanding revenue sources
  • Make and implement sound strategic decisions
  • Implement sound pricing and prudent financial management
  • Promote integrated water cycle management.