“FIT FOR THE FUTURE”The NSW Governments Council Mega-Amalgamation Agenda



A Local Government Reform Process began 4 years ago with a report and recommendations made by a Local Government Independent Review Panel, Chaired by Prof Grahame Samson.

This made Several Key Recommendations designed to fix the underlying business models of Councils and prepare them for the future. The most important and pressing of these related to fixing the funding model for councils. The least pressing was to examine structural reform, or “mergers”. With regard to structural reform the panel recommended that in the future, Councils should consider merging, OR FORMING STRENGTHENED REGIONAL ALLIANCES to enhance their “Scale and Capacity”. Some “Mega-merger” options were put forward as “Preferences” – however NOTE – these were “plucked from the air” in the sense that they were not backed up by any rigorous economic or social modelling of costs or impacts. There was no data or evidence to examine whether the prefered  mega-council options would enhance “scale and capacity” or not, or whether such large councils in fact would be “overscale” and “incapacitated” by being removed from their local communities. One of these “plucked from the air preferences” was for a mega-merger of all six lower North Shore Councils – North Sydney, Mosman, Willoughby, Ryde, Lanecove and Hunters Hill, to form a huge single mega-council of over 300,000 people.

The full ILGRP report, delevered OCT 2013, can be viewed here.


Following the ILGRP report the Government instituted the FIT FOR THE FUTURE PROCESS and developed criteria that councils had to meet to demonstrate that they were fit for the future. These included Financial, Efficiency, Infrastructure Management and Service delivery Criteria, and a Criteria called “Scale and Capacity” which was poorly defined, but required councils to demonstrate that they would have the same “scale and capacity” as the”plucked from the air” mega-merged council that was a “prefered option” for their council in the ILGRP report. (This was despite the fact that there was no empiric evidence to indicate whether the mega-merged councils were in fact of efficient scale and capacity or overscale, and no standardised method of actually measuring “scale and capacity” to determine what is best in the first place).

Councils across the State had to put in submissions to demonstrate whether they were “Fit for the Future” based on these criteria or not. There were no criteria that measured the importance and value of local representation, or of local autonomy and influence over character and development of local community areas.

1: Councils were required to make their submission to IPART, by June 2015. This was to determine if they were “Fit” for the Future, or whether they were “Unfit” and should merge.
2: Hunters Hill Council made a submission TO STAND ALONE – Councils extensive evidence, and community feedback did NOT SUPPORT AMALGAMATION.
3: To deliver economies and scale, and strategic capacity, HUNTERS HILL, along with RYDE and LANECOVE COUNCILS, instead of amalgamating, developed a “REGIONAL ALLIANCE” model in which they would STAY AS INDEPENDENT COUNCILS, yet work together where beneficial, to SHARE SERVICES and to undertake PLANNING FOR REGIONAL NEEDS with the State Government. (This was in alignment with the ILGRP recommendation as an alternative option to amalgamation, where amalgamation was not supported).  This is termed the JOINT REGIONAL AUTHORITY (JRA), and was strongly supported by the communities of all 3 councils.

4: The three councils put in a joint submission to IPART which you can view here:


IPART found all three councils passed all measures of financial fitness and sustainability, however the councils each “failed” the criteria called “Scale and Capacity” – (the unmeasurable, poorly defined and inconsistent applied “population size” criteria, that was based on comparison against the fictional “plucked from the air” mega-council of over 250, 000 people discussed above). Therefore, the three councils were deemed “UNFIT”, as were many other financially strong and sustainable councils through-out the city.

The Government is now trying to use this as an excuse to either co-erce or force councils to merge into mega-councils.


MAJOR CONCERNS AND CRITICISMS were raised regarding the GOVERNMENTS FIT FOR THE FUTURE PROCESS. In particular the “Scale and Capacity” criteria, which was poorly defined, unmeasurable, and inconsistently applied. There were concerns that the Government was using this flawed criteria to “fail” councils that were actually financially fit and sustainable, as an excuse to push through their mega-amalgamation agenda.



This was a bipartisan committee chaired by Paul Green MLC and consisted of Liberal and Labour and Greens and Christian Democrat members. They undertook an extensive inquiry with over one thousand submissions in writing and/or on line, expert witnesses and public hearings.
THE RESULTS, were recently released, and were scathing of the Governments Fit For The Future process.
The report called for the Government to:

A: Commit to No Forced Amalalgamation, citing that evidence did not support it.

B: Withdraw the claims that councils were “unfit” based on the “SCALE and CAPACITY criteria. (They found that this criteria was FLAWED, and NOT SOUND as an indicator of “fitness”)

The inquiry also STRONGLY SUPPORTED THE JRA MODEL of Hunters Hill, Lanecove and Ryde.

Here are some key excerpts from the UPPER HOUSE INQUIRY

Finding 5: That the scale and capacity criterion was a flawed criterion and it should not have been included in the Fit for the Future assessment criteria and accordingly assessments of councils’ fitness based on this threshold criterion are not well-founded.

Finding 9: That the projected economic benefits of council amalgamations have been consistently overstated by the proponents of forced amalgamations and the costs and extensive diseconomies of scale caused by amalgamations have not been adequately explained by those same proponents.

Recommendation 1: That the Premier and NSW Government withdraw the statements that 71 per cent of councils in metropolitan Sydney and 56 per cent of regional councils are ‘unfit’.

Recommendation 11: That the NSW Government commit to a policy of no forced amalgamations of local councils, except in circumstances where it can be established that a council is severely financially unsustainable to the point of bankruptcy or unable to maintain an acceptable level of service provision.
Recommendation 17: That the NSW Government work with local government on a statutory model for Joint Organisations based on the Hunters Hill, Ryde and Lane Cove Council model as a cooperative and consensus model for local council reform in Metropolitan Sydney.
Read the full documents here…

Executive Summary > http://bit.ly/1NC5Orw
Recommendations and Findings > http://bit.ly/1LCZTC7
Full Report > http://bit.ly/1Saov7B


Unfortunately The Government appears to be PUSHING ON REGARDLESS.

This is Against the Advice of

A) Key Australian Experts in Local Government

1: Prof Brian Dollery – Australias and possibly the Worlds leading expert in Local Government reform and council amalgamations. He has published extensive research and evidence on council mergers, and is scathing of the Fit For The Future Process.

Brian Dollery SMH – No evidence that council mergers will improve performance

Brian Dollery Government News – Few Benefits to Council mergers – Expert

Brain Dollery News Local – Expert Scathing of amalgamation assessment

Brian Dollery – Alternatives to Amalgamation in Australian Local Government

2: Professor Graham Sansom – Chair of the Original Independent Review Panel on Local Government.

Professor Sansom said “the ILGRP’s report had been misrepresented and poorly understood.” “The ILGRP did not argue that amalgamations are a panacea to the problems facing local government. It favoured a mix of some amalgamations – where appropriate and justified – and increased regional cooperation and resource sharing,” his submission said. Instead he argued for a broad package of policy changes to precede or accompany any boundary changes, including improvements to councils’ revenue bases and borrowing arrangements, better resource sharing, stronger regional organisations and better governance. Professor Sansom cautioned the NSW government against rushing the process and of being over-reliant on using the size of councils to predict their strategic capacity. He said there should be restrictions on the NSW government’s “currently unfettered right to impose amalgamations and boundary changes more or less at will” and advocated full community consultation, more careful analysis of the options and greater impartiality from both sides, including a stronger, more independent Boundary Committee”. NSW Local Government Reform blasted in public hearing

Graham Sansom, Author of Council Reform Criticises Government, and IPART

B) It is Also Against the Evidence, Advice and Recommendation of the UPPER HOUSE COMMITTEE

C) It is Against the express wishes of the MAJORITY OF LOCAL COMMUNITIES

Less than 1 in 5 local residents support amalgamations


Councils that were declared “unfit” have now been given until NOV 18th 2015 to put in a final submission in which they nominate (in 50 words or less. Their response to the IPART findings and their preferred voluntary merger option.

Councils are being threatened and co-erced into last minute merger options, against the express wishes of their communities, by the claim that if they don’t “choose their own path” the Government will force it upon them, and they will have no say in the process.

If councils refuse to merge, it is unclear what the Government will do. They do not appear to have the numbers to pass legislation through the upper house, and Legal advice indicates they do not have the power to sack councils in this setting either.

Clearly a more positive way forward for the Government would be to implement the findings and recommendations of the upper house committee.