Talking Point: Concept of voluntary council mergers is laughable
Voluntary amalgamation is never going to happen to better manage Tasmania’s 29 councils, because no alderman or councillor will vote themselves out of their job, writes former mayor GRAHAM BURY.
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September 15, 2020 9:45am
EVEN for those with little more than a passing interest in local government, it must seem strange that the most recent reform (code for amalgamations) was 27 years ago.
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Unless state government, which has complete authority over local government, changes its meaningless policy on council amalgamations and shows some political will by taking charge of any reform process, there will be many more years before much needed reforms occur.
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Among the barriers to reform is the state government policy on amalgamations. Minister Mark Shelton said, “the government’s position remains that local government reforms, such as amalgamations have the best chance of succeeding when they are voluntary” (Mercury, July 17).
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I searched far and wide without finding evidence to support this. It comes so soon after failed attempts involving Clarence, Sorell and Tasman councils.
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The only recent amalgamation in Australia is when state government has taken charge. It is surely no surprise that when it comes to a final vote councillors and aldermen do not like voting themselves out of a job.
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Governments do not have policies of voluntary taxation or voluntary speed limits. It is laughable to contemplate that such policies or that of voluntary amalgamations might work.
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I am no fan of forced amalgamations in the manner of the Kennett government in Victoria in 1993, but “voluntary amalgamations” do not occur.
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Another factor that should accelerate the urge for reform is financial sustainability of councils, in particular smaller ones.
A report from Access Economics for the Tasmanian Local Government Association in 2007 indicated “one in five councils may be unsustainable” and in 2009 the Auditor-General found ‘two thirds of Tasmanian councils were economically unsustainable’.
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FORMER MAYOR: Graham Bury
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Financial Assistance Grants for local government were introduced by the Whitlam government in 1974, with a roads component added in 1991.
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The local government grants bill 1974 says, “The Government’s aim is that the Grants Commission (through whom the funds pass), should play the same role in reducing local governing authorities inequalities … the grants are designed to reduce inequalities in the provision of ordinary services.
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However these funds should in no way be a substitute for revenues raised by councils by long established methods such as rates and charges for services”.
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Each council receives roughly $1 to $4 million a year.
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These grants, which are untied, have a disproportionate influence on smaller councils and seem to prop up their balance sheets. Welcome as these grants are, they have a perverse and unintended influence on the search for economies of scale.
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They disguise the need for reform and support the fiction that smaller councils are sustainable.
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Annual reports of 2018-2019 shows that for two larger councils, Hobart and Launceston, financial assistance grants make up 2 to 3 per cent of income, with Clarence at 4 per cent. But for some of the smaller councils such as Tasman, they make up 11 per cent of income — rising to 25 per cent if state grants are included, with Huon Valley at 13 per cent.
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It is no surprise the Auditor- General has been concerned about their financial viability.
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With exception of specific infrastructure projects, we should surely be expecting councils to raise a substantial part of their income from rates and charges, as now occurs only with the larger councils.
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Minister Mark Shelton. Picture: ZAK SIMMONDS
Well, do amalgamations save money? Yes, but not as much as predicted. Some activities are labour intensive. It is not always possible to reduce staff in areas such as planning and environmental services.
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A study by KPMG in 2016 showed in one option that a merger of Clarence, Sorell, Glamorgan Spring Bay and Tasman, “had the potential to yield savings of around $7.6m per year. With all the other options having merit and preferable to doing nothing”. Despite the best intentioned attempts at voluntary amalgamations, these predicted savings could not be tested. The least favoured option of doing nothing was the one to survive.
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So where do we go from here?
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Probably the first lesson comes from the attempted reforms in 1999. This provides one of the better models for how not to accomplish amalgamations.
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However, there is general agreement reforms leading to a reduction from 46 to 29 councils in 1993 was a successful process.
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A local government advisory board was established by the state government in 1991 and given two years to complete an “inquiry in to the modernisation of local government” and report to the minister. The advisory board consulted with all municipalities, elected members, staff and communities. State government at the time demonstrated a commitment to local government and the reform process, while making it clear amalgamations were expected. They facilitated vital local ownership and assisted acceptance and success of the reform process. They provided transition funds and established equal state and local government transition committees representing each council.
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So there is a way forward for reform of local government and it does not appear too difficult. Is state government going to continue to sit on its hands, protected by a policy on amalgamations that is in the realms of fantasy? And blame the failure of any attempts at amalgamation by councils on the councils themselves
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For goodness sake, please show some leadership.
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Dr Graham Bury is a retired paediatrician, Kingborough mayor from 2005 to 2014 and a patron of Education Ambassadors Tasmania.
COMMENT: Rather than amalgamation we need to be talking about eradication and replacing elected councils filled with people ill equipped for 21st C policy development and planning. Commissions filled with appointed 'experts' held accountable by Citizens Assemblies etc. is what is required. Fewer high flown bureaucrats more expert managers, planners and social scientists.
It is the 21st C and there are multiple mechanisms for the citizenry to be directly engaged in governance and collectively citizens working together couldn’t do a worse job than Tasmania’s relatively unrepresentative local governments.
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