Fewer councils more value

Fewer councils, more valueNew research reports reveal why council amalgamations can save local communities millions each year by improving efficiencies and service levels, while cutting red tape and bureaucracy.In South Australia, economic modelling has found that reducing local councils from 68 to 32 could deliver more than $0 million to local communities.The Property Council commissioned public policy consulting firm ACIL Allen to undertake the economic modelling, finding that the saving would amount to around $65 million each year.Savings would include $5.5 million annually by reducing the number of councillors and mayors, and almost $51 million in savings after three years from reducing the number of executives.Executive director in South Australia, Daniel Gannon, says local government reform is a potential “game changer” for South Australia’s local communities, but also for the state’s economy.”At a time when South Australia’s policy-makers are exploring future opportunities like nuclear energy, we need to continue to be bold and examine the role of local government,” he says.”Recasting council boundaries needs to be considered to ensure every dollar of ratepayer money is wisely spent at a time when our state’s economy is struggling.”According to the research, councils in South Australia are heavily reliant on a narrow rate base for revenue. Approximately 63 per cent of council revenue in the state comes from rates, compared to 38 per cent for Australia as a whole.Rates per capita in South Australia are the highest in the country, rising to $774.16 in 2013-14 – almost $1 more than the Australian average.While there would be upfront costs in implementing any reforms, Gannon says the benefits overwhelmingly outweigh the costs – with a benefit-cost ratio of 4.54.Meanwhile, in Tasmania, momentum for council amalgamations continues to build.The South East Councils Feasibility Study, commissioned by state and local governments in Tasmania and released earlier this month, has found a proposed merger of four municipalities into a super council would save ratepayers more than $7 million a year.”If we want to create jobs and continuous economic growth in Tasmania we need to act by delivering meaningful reform of local government in order to reduce costs and improve service delivery,” says executive director in Tasmania, Brian Wightman.A significant body of research and opinion polling has “delivered an unequivocal message to political leaders in Tasmania”, Wightman says. “In our latest June 2016 polling, the majority of respondents – 70 per cent – agreed that 29 councils for a population of 510,000 people was too many.”The Kennett Government in Victoria took a’ crash or crash through’ approach to local government reform, with significant community backlash, in the 1990s. More recently, the Baird Government has shown that reform can be achieved with broad community support, provided the benefits are communicated.Wightman points to the IPART Fit for Future Assessment in New South Wales, which finds that up to $2 billion in benefits could be realised through council amalgamations within Sydney over the next 20 years. “It’s time for reform, and it’s time for our political leaders to act in the best interest of rate-payers by working together to ensure that council amalgamations become a reality,” Wightman concludes.