Assessing impact of reform on the financial sustainability of CFA and FRV
Section 131(1)(iii) of the FRV Act requires FSIM to “monitor and review the progress of FRV and CFA in carrying out the implementation Plan, including by assessing the impact of fire services reforms upon the financial sustainability of FRV and CFA”.
In FY 2022-23, FSIM engaged with CFA, DJCS and FRV to inform its approach to assessing the impacts of changes implemented by the reform on the financial sustainability of CFA and FRV. FSIM also sought clarity on the scope of work CFA, DJCS and FRV are undertaking regarding understanding and supporting the future financial sustainability of CFA and FRV.
As noted in the FSIM Annual Report 2021/2022, there are significant gaps in CFA’s and FRV’s service delivery costs and cost drivers, and challenges in identifying emerging cost exposures under the new fire services model. CFA and FRV are currently working with DJCS to focus on uplifting their respective financial planning and forecasting capabilities.
CFA, DJCS and FRV continue to progress work relating to Year Two to Five Plan actions 5.1, 5.2, and 5.4. The outputs of these actions are necessary inputs to, and have significant interdependencies with, action 5.7.
Given the early stages of work to address data gaps, quantify costs and drivers and uplift forecasting capabilities, FSIM considers, at the time of reporting, there is currently insufficient information to make an informed assessment of the impact of reform on the financial sustainability of CFA and FRV. FSIM will continue to monitor these work programs, noting that assessing the impact of fire services reforms on the financial sustainability of FRV and CFV is a long-term proposition.
 Fire Services Implementation Monitor, 2023, Fire Services Implementation Monitor Annual Report 2021/22, Victorian Government, viewed 8 August 2023, < https://www.vic.gov.au/fire-services-implementation-monitor-annual-report-2021-22>, pg. 129.