tag:theconversation.com,2011:/uk/topics/council-mergers-23386/articlescouncil mergers – The Conversation2017-02-17T03:27:36Ztag:theconversation.com,2011:article/731182017-02-17T03:27:36Z2017-02-17T03:27:36ZBush democracy wins out but council mergers continue in Sydney<p>The 2016 announcement that 40 local councils in New South Wales would be dismissed and <a href="https://www.theguardian.com/australia-news/2016/may/12/nsw-council-mergers-19-new-local-bodies-created-under-forced-plan">replaced by 19 new ones</a> generated a <a href="https://www.theguardian.com/australia-news/2016/may/22/new-south-wales-council-mergers-have-political-ramifications">backlash</a> that has been strong and sustained. Efforts to resist amalgamation proved successful this week, at least for regional communities. New Premier Gladys Berejiklian has <a href="http://www.abc.net.au/news/2017-02-14/nsw-government-to-proceed-with-city-council-mergers-not-regional/8268340">announced</a> that the Coalition state government will no longer pursue forced amalgamations in the country. </p>
<p>For city councils, the <a href="http://www.news.com.au/national/nsw-act/politics/nsw-government-to-push-ahead-with-sydney-council-mergers-but-abandon-amalgamations-in-country-areas/news-story/a7e3c5fdfeea0761cab5bfbfda20ba1c">outlook is not so bright</a>. In councils that have been operating under administrators while awaiting new elections, anecdotal evidence from staff suggests the amalgamations have undone much hard work over many years in developing policies aligned with community preferences. </p>
<p>In the councils that took their opposition to the mergers to court, much uncertainty remains.</p>
<h2>Costs versus benefits</h2>
<p>Opponents have challenged the costs of mergers. A key concern for <a href="http://www.dailytelegraph.com.au/newslocal/wentworth-courier/woollahra-mayor-defends-costs-of-launching-appeal-in-face-of-mounting-court-costs/news-story/b0bcbff992d9f67728748f2c103ee5fc">Woollahra</a>, for example, is that residents would face significant rate increases. They would also have to compete for funds against larger facilities in more populous and more distant parts of the expanded council. </p>
<p>The government’s stated reasoning for consolidation was largely financial. This included a claim that councils were losing up to A$1 million a day. Yet the calculations on which those arguments were based have been challenged as <a href="http://www.smh.com.au/nsw/states-councils-rich-and-getting-richer-as-merger-deadline-looms-20150630-gi18tu.html">inaccurate and misleading</a>. </p>
<p>Analysis of the <a href="https://theconversation.com/do-mergers-make-for-better-councils-the-evidence-is-against-bigger-is-better-for-local-government-56813">outcomes of previous mergers</a> also shows little evidence of the promised economies of scale.</p>
<p>Others have focused on the benefits to particular interest groups. <a href="http://www.2gb.com/podcast/alan-jones-professor-brian-dollery/">Alan Jones</a> is one prominent commentator to suggest the amalgamations were influenced by a desire to reduce obstacles for property developers. The pursuit of city council mergers while abandoning regional consolidation does nothing to dispel such concerns.</p>
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<p>More fundamentally, the <a href="https://theconversation.com/how-council-mergers-and-reforms-imperil-local-government-democracy-56014">loss of democracy</a> associated with mergers has been a key focus of <a href="http://www.saveourcouncilsnsw.com/">opposition</a>. Previous amalgamations in NSW have been linked with <a href="http://www.smh.com.au/articles/2004/03/27/1080330993068.html">political agendas</a>, particularly efforts to bring local councils under the control of major parties. </p>
<h2>Law and politics</h2>
<p>Across Australia, the legal <a href="http://www.aph.gov.au/About_Parliament/Parliamentary_Departments/Parliamentary_Library/pubs/rp/rp1011/11RP10">status of local government</a> has been a matter of long-running debate. While many councils existed well before Federation, the Australian Constitution makes no mention of local government.</p>
<p>Amending the Constitution to recognise local government was considered through referenda in <a href="https://www.electoralgeography.com/new/en/countries/a/australia/1974-referendum-australia.html">1974</a> and <a href="https://www.electoralgeography.com/new/en/countries/a/australia/1988-referendum-australia.html">1988</a>, and <a href="http://www.abc.net.au/news/2013-07-02/lane-local-government-referendum/4793956">would have been considered again</a> in 2013 if Julia Gillard had remained prime minister until the election. Without such recognition, control of local government is left to the states.</p>
<p>Even if they succeed in court, the councils challenging amalgamations <a href="https://www.claytonutz.com/knowledge/2016/august/fatal-blow-or-flesh-wound-court-dismisses-challenge-to-nsw-governments-forced-council-amalgamations">face an uphill battle</a>. Legally, the state can require local councils to amalgamate. </p>
<p>NSW has had many council mergers since the first Local Government Act was passed in 1906. The number of councils is now <a href="http://www.localgovernmentreview.nsw.gov.au/documents/lgr/Barriers%20and%20incentives%20to%20voluntary%20boundary%20change.pdf">less than half what it was</a> then, and many of the mergers were forced.</p>
<p>The current disputes and litigation do not challenge the basic idea that the state can force amalgamations. Rather, the challenges are about process: whether the NSW government followed the procedures set out in the act for things like studies, timing and public notice. </p>
<p>To resist mergers, councils will need to secure much wider support. As this week’s decision to abandon rural council mergers shows, political alliances can be successful in protecting local institutions. The coming state byelections in <a href="http://www.abc.net.au/news/2017-01-22/local-government-merger-campaigners-to-fight-liberals-in-manly/8201272">Manly</a>, <a href="http://www.smh.com.au/nsw/premier-gladys-berejiklian-prepares-for-north-shore-byelection-backlash-over-mergers-20170214-gucjy7.html">North Shore</a> and <a href="https://www.google.com.au/url?sa=t&rct=j&q=&esrc=s&source=web&cd=1&cad=rja&uact=8&ved=0ahUKEwiPhrOJ7pXSAhVHVZQKHZFWB2sQFggZMAA&url=http%3A%2F%2Fwww.smh.com.au%2Fnsw%2Fthird-byelection-as-gosford-mp-kathy-smith-resigns-from-parliament-20170213-guc32c&usg=AFQjCNEbThJXHU-FsK3RSRPgPdh4Hn4wag">Gosford</a> may give city councils opportunities to build on that support. </p>
<h2>Decision-making at the local level</h2>
<p>Control of local government is increasingly important. As state and national governments appear unable to deal with a growing number of pressing issues, cities in <a href="https://theconversation.com/coastal-communities-including-24-federal-seats-at-risk-demand-action-on-climate-threats-58764">Australia</a> and <a href="https://theconversation.com/why-mayors-are-looking-for-ideas-outside-the-city-limits-49870">internationally</a> have been key sites for leadership. </p>
<p>On issues from <a href="http://www.c40.org/ending-climate-change-begins-in-the-city">climate change</a> to <a href="https://www.london.gov.uk/what-we-do/business-and-economy/london-living-wage">employment conditions</a>, local governments have proved nimble, innovative and responsive to local desires. The significance of amalgamations thus extends well beyond their immediate constituents. </p>
<p>Amalgamations may have advantages. Larger councils might be well placed to tackle issues like housing or public transport where the <a href="https://theconversation.com/states-drag-feet-on-affordable-housing-with-victoria-the-worst-72867">state has proved ineffective</a>. Or they might not. </p>
<p>In pushing scale without rethinking roles and responsibilities and, particularly, in its focus on dubious financial justifications, the NSW government has missed an opportunity. Rather than reflecting on and perhaps even revitalising local institutions and democracy more generally, the government has exacerbated the already high levels of mistrust between the state and councils and the public.</p><img src="https://counter.theconversation.com/content/73118/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Amelia Thorpe does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>The proposed amalgamation of 40 NSW councils has generated heated opposition. While public resistance has now won out in several regional communities, it’s a different story in the city.Amelia Thorpe, Senior Lecturer and Director of Environmental Law Programs, UNSW SydneyLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/560142016-04-06T03:53:58Z2016-04-06T03:53:58ZHow council mergers and reforms imperil local government democracy<figure><img src="https://images.theconversation.com/files/116710/original/image-20160330-28468-szkq9j.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Unless councillors are helped to focus on their representative roles, local democracy's effectiveness could be in danger.</span> <span class="attribution"><span class="source">AAP/Darren Pateman</span></span></figcaption></figure><p>Australia’s local government sector has been <a href="http://www.smh.com.au/nsw/council-amalgamations-north-sydney-seeks-legal-advice-as-the-endgame-approaches-20151209-glj52s.html">undergoing reform</a> in recent decades. The result has been fewer and larger local governments and a reshaped role for elected members or councillors. But do councillors understand what this means for them?</p>
<p>From the 1990s, the number of councils in Australia has <a href="http://www.spaef.com/article/1443/An-evaluation-of-amalgamation-and-financial-viability-in-Australian-local-government">decreased from 826 to 565</a>. Reforms have focused on local councils’ administrative, financial and technical capacities.</p>
<p>These reforms tend to strengthen local government’s service-delivery role. But, so far, they have done little to support local representation and democracy. There are significant concerns that these reforms may have a negative impact on local democracy.</p>
<h2>What the changes mean</h2>
<p>Local government legislation has changed in many Australian states. The legislation now sets out the roles of the CEO or general manager and the role of councillors. The CEO generally has management responsibility for the organisation while councillors are responsible for strategy and policymaking. </p>
<p>However, what councillors may not <a href="http://www.acelg.org.au/publications/local-representation-australia-view-victoria">necessarily understand</a> is that their role is strategic leadership – not the day-to-day management of the organisation. </p>
<p>As part of the authors’ research, we conducted a national survey of councillors on their views of their roles and responsibilities. The preliminary results make it clear they felt they should have more influence over administrative policy and procedures. The difficulty is that legislation says this is the responsibility of the CEO or general manager. </p>
<p>This matters. If councils are larger organisations and councillors represent more residents, it is important that they focus on understanding their communities’ needs and aspirations. For local democracy to be effective, councillors should focus on developing strategic plans to meet residents’ needs, rather than trying to manage day-to-day operations.</p>
<p><a href="http://www.fitforthefuture.nsw.gov.au">State governments argue</a> that the main objective of local government reform is to make councils more efficient. They want to ensure local government’s financial sustainability and its ongoing ability to provide services to the community. This usually leads to fewer and larger local governments. </p>
<h2>A new role?</h2>
<p>Australia’s 5,060 councillors represent a wide diversity of communities and govern very different kinds of organisations.</p>
<p>The 565 councils in Australia range greatly in size. The largest, <a href="http://www.brisbane.qld.gov.au">Brisbane City Council</a> in Queensland, has an annual operating budget of A$2.9 billion and serves a community of just over a million people. It covers an area of 133,809 hectares. </p>
<p>The smallest, <a href="http://www.sandstone.wa.gov.au">Sandstone Shire Council</a> in Western Australia, comprises a population of 116 and covers a land area of 3,266,650 ha. This is comparable to the size of Belgium. It had an annual operating budget in 2014 of $3.4 million. </p>
<p>Local government reforms include a stronger emphasis on councillors’ strategic, long-term decision-making role. In New South Wales, councils also have to establish community-engagement strategies. </p>
<p>These changes were intended to shift a previously widespread perception of local councils as simply managers of local services and local infrastructure to one where their role, as democratically representative bodies, gained in significance. </p>
<p>This defining of roles between strategic decision-making and involvement in day-to-day administration is problematic. Some councillors have <a href="http://www.tandfonline.com/doi/abs/10.1080/01442872.2013.822704#.VvtZl8caB_U">expressed frustration</a> and confusion when, following changes in the legislation, they are no longer able nor permitted to deal directly with staff.</p>
<p>The preliminary results of our study show that what councillors think is their role may not be the same as the intent of local government reform. Larger local governments also means councillors must represent more people. </p>
<p>Unless councillors are helped to focus on their representative roles, engaging with and understanding their communities rather than being too focused on day-to-day council operations, local democracy’s effectiveness could be imperilled.</p><img src="https://counter.theconversation.com/content/56014/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Roberta Ryan is Director of the Australian Centre of Excellence for Local Government which received funding from the Australian Commonwealth.</span></em></p><p class="fine-print"><em><span>Su Fei Tan receives funding from the Australian Centre of Excellence for Local Government. </span></em></p>If local councils are bigger and councillors represent more residents, it is important that they focus on understanding their communities’ needs and aspirations, rather than on day-to-day operations.Roberta Ryan, Director, UTS Centre for Local Government and Australian Centre of Excellence for Local Government, University of Technology SydneySu Fei Tan, Lecturer, lnstitute for Public Policy and Governance, and Senior Research Officer, Centre for Local Government,, University of Technology SydneyLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/568132016-03-30T19:11:18Z2016-03-30T19:11:18ZDo mergers make for better councils? The evidence is against ‘bigger is better’ for local government<p>Hard-pressed ratepayers in New South Wales and Queensland need no reminding of the perils of municipal amalgamation. NSW experienced a sharp dose of <a href="http://www.abc.net.au/news/2004-02-07/nsw-considering-more-forced-mergers/131764">forced mergers in 2004</a>. Queenslanders underwent draconian council consolidation <a href="http://www.abc.net.au/news/2007-08-10/council-amalgamation-laws-pass-through-qld/636100">under the Beattie government in 2008</a>.</p>
<p>NSW is now on the cusp of a <a href="http://www.smh.com.au/nsw/council-mergers-baird-government-reveals-which-sydney-councils-will-change-20151217-glqk5y.html">further round of mergers</a> being inflicted on unwilling councils.</p>
<p>In all three cases, the architects of compulsory amalgamation have been under the sway of the dogma that “bigger is better” in local government. Ratepayers are told amalgamation will herald a new dawn of lower rates, cheaper services, improved service quality, enhanced financial viability and superior administration and planning.</p>
<p>In NSW, the Baird government has especially emphasised the <a href="http://www.fitforthefuture.nsw.gov.au/investing-in-local-government-reform">financial advantages of municipal amalgamation</a>. These claims are typically presented as the outcome of careful research and deliberation.</p>
<h2>Mergers tested in a real-world experiment</h2>
<p>Are these claims consistent with the empirical evidence? My colleagues Brian Bell and Joseph Drew and I investigated this question for NSW’s 2004 forced amalgamations. </p>
<p>We took advantage of being able to use 2014 data to compare the performance of merged councils with their unmerged counterparts over ten years.</p>
<p>We compared amalgamated “general purpose” councils with their un-amalgamated peer councils in the same local government classification. We thus had the benefit of a “natural experiment”, being able to compare the two groups of “like” councils against a common set of performance indicators. </p>
<p>Our peer-reviewed research paper will be <a href="http://esa.snapdev.com.au/news/15991">published shortly</a>.</p>
<p>The criteria we used for this comparison included four the Baird government is using under its “<a href="http://www.fitforthefuture.nsw.gov.au/">Fit for the Future</a>” program – operating performance, own-source revenue, building and infrastructure renewal, and asset maintenance ratios – as well as council employees per capita.</p>
<p>We found no statistically significant differences in the performance of the two groups of councils against these criteria. This falsifies past claims by the Carr Labor government that its forced amalgamations would substantially improve NSW local government financial performance. It also undermines the Baird Coalition government’s claims for its proposed mergers. </p>
<h2>Evidence mounts against ‘bigger is better’</h2>
<p>Other research provides additional damning evidence. For example, Joseph Drew, Mike Kortt and I examined the <a href="http://www.abc.net.au/news/2016-02-16/nsw-urged-not-to-repeat-qlds-council-amalgamation-mistakes/7167322">outcomes of forced amalgamations in Queensland in 2008</a>. These reduced the number of councils from 157 to just 73. </p>
<p><a href="http://www.tandfonline.com/doi/abs/10.1080/03003930.2013.874341?journalCode=flgs20">Our research</a> demonstrated that this resulted in a greater proportion of councils exhibiting diseconomies of scale. That is, mergers created entities that were simply too large to be run efficiently.</p>
<p>Furthermore, of the 31 new councils the mergers created, 58% exhibit decreasing returns to scale. Comparing their efficiency through time, we found merged councils performed worse than unmerged councils.</p>
<p>Finally, Elizabeth Sinnewe, Mike Kortt and I recently tested the claim that “bigger is better” by examining the financial performance of Australia’s largest council by population, Brisbane City. In our recently published <a href="http://onlinelibrary.wiley.com/doi/10.1111/1467-8500.12118/abstract">analysis</a>, we compared Brisbane City Council to Sydney City Council, the average of six southeast Queensland councils and the average of ten metropolitan NSW councils. </p>
<p>We did so using four measures of financial performance – financial flexibility, liquidity, debt service capacity and asset management. Between 2008 and 2011, the three comparator groups outperformed Brisbane Council in financial flexibility, liquidity and debt-servicing ability. </p>
<p>Taken together, these three papers cast doubt over the continuing dogma that “bigger is better”. They also add to the empirical literature on municipal mergers by demonstrating that “biggest is not best” either. </p>
<p>In particular, the financial performance of local authorities does not improve as advocates of amalgamation contend. On the contrary, amalgamated municipalities often perform worse than their unmerged counterparts.</p>
<p>Amid the controversy over the Baird government’s <a href="http://www.abc.net.au/news/2016-02-02/council-amalgamations-councillors-say-public-meetings-a-farce/7132778">compulsory council consolidation</a> program, our findings underline the foolishness of making public policy in an “evidence-free” manner.</p>
<p>If forced amalgamations proceed, we may well see hundreds of millions of dollars in taxpayer and ratepayer funds squandered simply because policymakers preferred dogma to empirical evidence.</p><img src="https://counter.theconversation.com/content/56813/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Brian Dollery does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>If forced amalgamations proceed, we may well see hundreds of millions of dollars in taxpayer and ratepayer funds squandered simply because policymakers preferred dogma to empirical evidence.Brian Dollery, Professor of Economics and Director of the Centre for Local Government, University of New EnglandLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/523812015-12-16T01:27:05Z2015-12-16T01:27:05ZNSW councils shake-up: is the endgame near?<p>The Baird government is pressing on with its <a href="http://www.smh.com.au/nsw/council-amalgamations-north-sydney-seeks-legal-advice-as-the-endgame-approaches-20151209-glj52s.html">agenda for restructuring</a> local government across New South Wales and for the Sydney Metropolitan Region in particular.</p>
<p>Casting ahead to see what the outcomes might be, the experience of other Australian states and territories is salutary. It appears likely there will be a political price to pay at the next state election due in March 2019. Of more concern is that the reasons for undertaking reform have been lost in the fog of politics – both party-political and state-local.</p>
<p>Speculation about the process’ probable endgame is rampant. In essence, the government’s plans involve a radical reduction in the number of councils. The change in Sydney would be particularly intense – from 41 councils to anywhere between six and 20.</p>
<p>Councils are loath to concede that they will do as the government says and endure a reduction in local representation. Rumours of the <a href="http://www.dailytelegraph.com.au/news/nsw/all-nsw-councils-to-be-sacked-before-forced-move-to-super-councils-minister-proposes/story-fni0cx12-1227484915213?sv=36a27febda110cbf4693ab4938e77dc0">wholesale sacking of all councils</a>, to be followed by compulsory mergers, have circulated.</p>
<p>Some councils have armed themselves for <a href="http://www.dailytelegraph.com.au/newslocal/north-shore/north-sydney-council-prepares-legal-challenge-against-possible-forced-amalgamation-with-neighbours/story-fngr8h9d-1227540116002">legal challenges to any forced mergers</a>. Any such challenge would test state-local government relations. However, in law as a sovereign government, the state, if pressed, would surely prevail.</p>
<p>The reform process has been lengthy. First, an inquiry by the <a href="http://www.localgovernmentreview.nsw.gov.au/home.asp">Independent Local Government Review Panel</a> culminated in its <a href="http://www.localgovernmentreview.nsw.gov.au/Index.asp?areaindex=LGR&index=49&acode=GL&mi=1">final report</a>. Published in October 2013, the report contained 65 recommendations.</p>
<p>Second, the government response, <a href="http://www.fitforthefuture.nsw.gov.au/">Fit for the Future</a>, launched in September 2014. This required all councils to submit proposals weighted toward the option for amalgamation by June 30, 2015.</p>
<p>Third, these proposals were assessed by the Independent Pricing and Regulatory Tribunal (IPART). The tribunal delivered its 500-page <a href="http://www.ipart.nsw.gov.au/Home/Industries/Local_Govt/Reviews/Fit_for_the_future/Review_of_Local_Council_Fit_For_The_Future_proposals/News/Final_Report_on_Fit_for_the_Future_Council_proposals_released">final report</a> on October 20. Councils then had to respond by November 18.</p>
<p>In the coming days, the government is due to decide which councils ought to amalgamate. It will reconstitute the <a href="http://www.smh.com.au/nsw/local-government-amalgamations-in-spotlight-amid-plans-for-boundaries-commission-20141207-121zq7.html">Local Government Boundaries Commission</a> to oversee the process.</p>
<p>In May this year, the opposition parties combined in the NSW Upper House to initiate the <a href="http://www.parliament.nsw.gov.au/localgovernment">Local Government in New South Wales Inquiry</a>. The inquiry roundly criticised the Coalition government on procedural and evidential grounds in its <a href="http://www.parliament.nsw.gov.au/prod/parlment/committee.nsf/0/B0C026787382E495CA257EEC007FFECA?open&refnavid=CO4_1">final report</a> tabled at the end of October.</p>
<p>It is important to note the government has created a new statutory planning body, the <a href="http://www.planning.nsw.gov.au/Plans-for-Your-Area/Sydney/A-Plan-for-Growing-Sydney/Greater-Sydney-Commission/">Greater Sydney Commission</a>, which will be headed by a former lord mayor of Sydney, <a href="http://www.smh.com.au/nsw/lucy-turnbull-slated-for-greater-sydney-commission-planning-role-20151030-gkn5sn.html">Lucy Turnbull</a>. Under the <a href="http://www.parliament.nsw.gov.au/Prod/parlment/nswbills.nsf/d6079cf53295ca7dca256e66001e39d2/69b90b4960628bb0ca257ee40018d0a9/$FILE/ATTX2FHE.pdf/Passed%20by%20both%20Houses%20version.pdf">Greater Sydney Commission Act</a>, councils will be obliged to recognise its authority in planning matters.</p>
<h2>Council mergers are political dynamite</h2>
<p>Experience in Australia’s other states and territories suggests that council amalgamation programs have an electoral impact upon the governments that execute them.</p>
<p>For instance, the amalgamations undertaken in Queensland in 2008 are <a href="http://onlinelibrary.wiley.com/doi/10.1111/1467-8500.12057/abstract">cited as a contributing factor</a> to the electoral wipeout of the Bligh government in 2012. The radical regionalisation of councils in the Northern Territory in 2008 – from 53 community councils to just eight regional councils – is cited as <a href="http://theconversation.com/was-the-nt-election-outcome-a-shockwave-or-a-regional-ripple-9138">one reason</a> for the Labor Party’s defeat in 2012.</p>
<p>In Western Australia, the fear of electoral backlash has arguably prevented the <a href="https://www.mediastatements.wa.gov.au/Pages/Barnett/2015/02/Future-of-LG-reform-now-rests-with-councils--.aspx">Barnett government</a> from pursuing amalgamations across the City of Perth.</p>
<p>With this negative electoral impact possible, one could argue that the Baird government is being politically courageous. It is equally possible to argue that the process has degenerated into an argument over amalgamations.</p>
<p>In his contribution to a <a href="https://www.federationpress.com.au/bookstore/book.asp?isbn=9781862879850">recent edited book</a> on Australian local government reforms, former local government minister Don Page gave three reasons for initiating local government restructuring. At the top of the list was his observation that:</p>
<blockquote>
<p>The relationship between state and local government had deteriorated to a point where it could accurately be described as toxic.</p>
</blockquote>
<p>Second was the issue of the financial unsustainability of “many councils”, followed by “a focus on compliance rather than performance”.</p>
<h2>Evidence for merger savings is weak</h2>
<p>Amalgamation as a means to achieve enhanced financial sustainability has been somewhat discredited. Even the IPART-commissioned “confidential report’ by Ernst and Young, which was published as Appendix E of its <a href="http://www.ipart.nsw.gov.au/Home/Industries/Local_Govt/Fit_for_the_Future">final report</a>, is cautious in this regard. It states that "cost savings … may be difficult to measure” and that “econometric analysis does not provide strong support”.</p>
<p>Further, our work at the UTS Centre for Local Government on <a href="http://www.acelg.org.au/publications/Service%20Delivery?combine=&field_date_value%5bvalue%5d%5byear%5d=&field_program_nid=All&field_publication_type_tid=All">service delivery</a> demonstrates that a focus on enhanced performance can be achieved within existing councils.</p>
<p>The former minister’s principal concern, namely the relationship between state and local governments, has arguably been harmed by the handling of the reform process. The sector’s latest report on <a href="http://www.lgnsw.org.au/files/imce-uploads/127/cost-shifting-survey-2013-14.pdf">cost-shifting</a>, released last week, is evidence of the state of play.</p>
<p>The state government, statutory bodies and other stakeholders will have to work hard to improve this relationship. This will be the case no matter what the outcome of the government’s imminent deliberations. This suggests there is a lot more work to do; the very idea of an “endgame” for the process may be premature.</p><img src="https://counter.theconversation.com/content/52381/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Through his employing organisations, Bligh Grant consults to a range of state and local governments across Australia. In relation to the current reform processes in NSW, the authors have undertaken commercial consulting for Oberon Shire Council, Gwydir Shire Council and Local Government NSW.</span></em></p><p class="fine-print"><em><span>Through her employing organisations, Roberta Ryan consults to a range of state and local governments across Australia. In relation to the current reform processes in NSW, the authors have undertaken commercial consulting for Oberon Shire Council, Gwydir Shire Council and Local Government NSW.</span></em></p>Wherever governments have merged local councils, they have faced a political backlash. New South Wales is no exception and, nearly four years into the process, many challenges lie ahead.Bligh Grant, Senior Lecturer, Centre for Local Government, University of Technology SydneyRoberta Ryan, Director, UTS Centre for Local Government and Australian Centre of Excellence for Local Government, University of Technology SydneyLicensed as Creative Commons – attribution, no derivatives.