While more than four in ten Australian and New Zealand local government organisations are exploring the use of artificial intelligence through pilot projects, only 20% are currently scaling use cases or embedding AI into daily operations.
This is one of the findings in a survey of 166 council leaders from New Zealand and New South Wales by technology vendor Datascape.
The Datascape AI Insights report was produced from research across three local government conferences held in 2025. It found that around 42% of the councils surveyed were exploring AI though pilot projects, while 38% were focussed on the governance and trust networks to support the technology.
Datascape said that while there was experimentation and ambition to use AI, everyday AI in the local government sector was still the exception.
Close to nine in ten leaders described their teams as early-stage AI learners, with most staff self-teaching through individual efforts rather than structured programs. Fluency is growing, but unevenly, as it is being carried by the curious few rather than lifted by the organisation.
According to the Datascape report, around 40% of councils are not measuring AI uplift at all.
Another 28% have isolated examples but no consistent framework. Only about one in ten can track baseline data and quantify return on investment clearly.
The report highlights a case study from Moorabool Shire Council in Victoria, a Datascape customer.
The council reported benefits from AI enabled automation, which was used to improve the processing of data from one system to another and from different formats.
What were once five-to-ten-minute jobs were instead being completed in under a minute, leading to a projected saving of 12 weeks of staff time per year.
Moorabool’s move to Datascape’s property and rating system alone cut rate notice processing times from minutes to seconds, recovering two weeks of annual processing efforts.
Linked service requests, rate accounts, and reproduction notices eliminated duplication, and budget forecasting, direct debit rollovers, and audit trails now live in a single platform.
The council’s Customer Relationship Management (CRM) rollout centralised online forms, payment processing, and correspondence tracking into one view.
Sixty per cent of applications shifted from paper to digital submission. Staff spend less time navigating systems and more time helping people.
When Moorabool introduced Antenno, a mobile app for two-way community engagement, nearly 1000 residents downloaded it within months.
Just over 10% of customer requests now come through digital channels, with a target of 25-50% digital engagement considered achievable.
