Mike Baird

Councils in New South Wales will be offered $1 billion in incentives to amalgamate or risk having planning controls withheld.

The measures, called the Fit for the Future package, were announced today by Premier Mike Baird and Local Government minister Paul Toole.

“The Fit for the Future package is the most significant investment the state has ever made in the local government sector,”Mr Baird said.

“We are committed to Rebuilding NSW and to achieve this we need a strong local government sector.

“However this is not possible when more than one-third of the state’s councils are facing financial problems – losing more than $1 million a day.”

Mr Toole said the plan recognised that without incentives, change-resistant councils would be hesitant to take up proposed reforms.

The government has been attempting to push amalgamation since it was elected, with little success due to opposition from councils that are better placed than their surrounding neighbours and a lack of community support.

Strathfield Council, which has been vocally opposed to merging with surrounding Burwood, Auburn and Ashfield councils due to what it says is a superior budget position, lower rates and better infrastructure, said the $1 billion dollars was an inappropriate use of taxpayer money.

“This is the state government offering councils 30 pieces of silver to sell out the interests of their communities,”Strathfield mayor Daniel Bott said.

He said the premier was offering “bribes and threats to persuade us to disregard the interests of our community”.

While the government committed in the last election not to force local councils to amalgamate, according to the Daily Telegraph those that merged would also be granted more planning controls.

“So communities that decide they want to keep their local government local will be punished by having control over their LGA stripped from them,”Mr Bott said. “That is disgraceful, and represents a fundamentally undemocratic concept.”

Parramatta Council has voiced support, with Lord Mayor John Chedid saying the move would bring more resources to the area.

“If it means that we can provide better services, better infrastructure, better returns for our community then I really support it,” Mr Chedid said.

The City of Sydney has also opposed merging with surrounding councils to form a “mega-council”in the style of Brisbane.

Lord Mayor Clover Moore, who the state government today (Wednesday) is pushing legislation to oust from power, previously said there were options for strengthening councils that did not require amalgamation.

“Local government is the level of government closest to the community and I believe it best serves the community when it is truly ‘local’ in character,”Ms Moore said.

Vested interests, she said, were pushing amalgamation as the answer to “cut communities out of the decision making process for their neighbourhoods and ensure that the big political parties control local government, especially in relation to development”.

Meanwhile, the Property Council of Australia came out in support, saying local councils should seize the opportunity to modernise.

“Local councils have been thrown a lifeline –and they should grab it with both hands,” NSW executive director Glenn Byres said.

“Independent reports have consistently shown the majority of councils are financially unsustainable and they now need to take responsibility for their own plight.

“The property industry pays up to $5 billion every year in rates, charges and taxes –and submits over 70,000 development applications. We need local government to work well.”

Councils in Sydney, he said, needed to reduce from 40 to 10.

The Fit for the Future package includes:

  • $258 million to assist councils who decide to merge and make the changes needed to provide better services to communities ($153m for Sydney councils and $105m for regional councils)
  • Cheaper finance for councils to build and maintain the facilities that communities need, saving them up to $600 million
  • Up to $100 million savings through reductions in red tape and duplication
  • Improvements to the local government system, including the laws that govern it, the way the State works with councils and the support that councils receive

Councils will have until 30 June 2015 to submit a proposal.