The development and use of performance indicators in Victorian local government

The use of performance indicators in the public sector has long been encouraged. However, recent research findings have suggested that performance measurement is seen to be problematical and the use and development of performance indicators is not as extensive as is thought possible. There has also been a questioning of the validity of the rationalist model of performance measurement and it has been suggested that there are alternative models. This paper examines: 1) the extent of the use of performance indicators in Vietonan local government; 2) the possible barriers to their use; 3) models of performance measurement and; 4) the role of the implementation process in the development and use of performance indicators. The research is based on a questionnaire sent to all local govemments in Victoria and four case studies. The data reported in this paper is derived from councils that reported using program budgeting. The results of the research suggest that there is only a limited use of performance indicators by Victorian municipalities. The alternative models of performance measurement appear to be in evidence. The findings indicate that the implementation process is an important factor in the development and use of performance indicators.