It’s no longer a question of if AI matters to Australian councils. The real question is how to translate ambition into safe, measurable everyday gains.
At the recent Local Government NSW Annual Conference and the Association of Local Government Information Management (ALGIM) Annual Conference in Wellington, Datacom asked 117 council leaders – from CEOs and CIOs to councillors and service managers – five simple questions about their AI journey. What they said was revealing.
The outcomes councils want are remarkably consistent: increased community trust, faster service delivery and lower costs. While most are actively piloting AI or building governance frameworks, only seven per cent have embedded AI into everyday operations. Two-thirds can’t yet measure the uplift or return on investment from their efforts.
This isn’t a story about councils falling behind. It’s about an entire sector in motion, navigating the messy middle between pilot projects and proven practice.
The councils moving fastest share a common playbook. They pick one focus area and one outcome, rather than trying to transform everything at once. They design for fractional, compounding gains: drafting reports, summarising consultations, triaging service requests or supporting staff with complex queries. They embed AI where work already happens. In customer relationship management, online services and case management, rather than asking staff to adopt yet another tool. Case in point: Moorabool Shire Council in Victoria. Read more about their story here.
Critically, they start measuring even when it’s imperfect. They look at a handful of metrics: time saved per task, cases processed per full-time equivalent and response times, all captured at baseline and measured after. Imperfect but consistent measurement beats none at all.
Want to see where your council sits on the Australia and New Zealand AI maturity curve?
Datacom’s full local government AI insights FY26 report unpacks exactly where councils across Australia and New Zealand are focusing. Dive in to see what’s holding them back and what their next steps are going to be.
Register here to get the full report
Datacom will continue to update the report as it learns from further councils.
Datacom is building AI that works the way councils do – embedded within the Datascape platform, workflow-aware and designed for fractional gains that compound. From property and rating to regulatory and customer operations, Datascape AI is purpose-built to deliver safe, measurable uplift without adding complexity.
Want to explore what that looks like for your council? Visit digital.datacom.com
