Council told to 'follow Act' to demerge

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The Minister for Local Government, the Hon Ron Hoenig MP, has asked Snowy Valleys Council (SVC) to use the statutory pathway provided by the current Local Government Act if they wish to seek a demerger.

From the office of Dr Joe McGirr

In a meeting arranged by independent local state MP Dr Joe McGirr, the Minister heard the concerns of the community and the desire of SVC to demerge from Mayor Ian Chaffey and Deputy Mayor Trina Thompson.

Since the councils of Tumbarumba and Tumut were forcibly amalgamated in 2016 into the Snowy Valleys Council (SVC) by the former state government none of the promised savings or efficiencies have eventuated.

In fact the opposite has occurred.

Rates have increased, operational efficiencies have not improved, staff morale is low and ultimately it is ratepayers who are paying the price of the former government’s actions.

Minister Hoenig told the Mayor and Deputy Mayor: “I recognise that there is strong support in your communities to demerge. I am aware of the strength of that community feeling, both through Dr McGirr and through the boundaries commission last time. Any final decision will, of course, depend on the outcome of the process, and SVC should now continue their work.”

“The meeting was positive and constructive,” said Dr Joe McGirr. “I believe the Minister understands the situation and the key is to map the way forward and the Minister recommended pursuing the process outlined in the Act.”

Minister Hoenig noted the government policy that decisions on demergers must be made with the support of residents.

The Mayor, Cr Ian Chaffey, said, “We want to partner with the Government to achieve the demerger. We will need their support to do this.”

The Minister reiterated the importance of a viable competent local government sector and the critical role played by councillors.

Deputy Mayor Trina Thomson agreed and stated, “I’m terrified that our communities are losing their passion. Because the demerger has failed so dramatically, by what has been imposed on us by previous Governments. I want our Councils to be role models and leaders and we just want our communities to have faith in local government.”

The Mayor invited Minister Hoenig to visit and meet directly with the council and the Minister agreed to do so.

Dr Joe said, “I am very appreciative of this important gesture of good faith and look forward to welcoming the Minister in the near future to work together in genuine partnership.”

Dr McGirr made the following Private Member’s Statement in parliament on June 27 in relation to the 2016 council mergers.

“In 2016 the Baird Government took away the democratic rights of communities by forcing council amalgamations across the State.

“Since that time, the majority of the amalgamated councils in NSW, especially in the regions, have failed to deliver the promised savings and efficiencies.

“One of the worst examples is the merger of Tumbarumba and Tumut councils into the Snowy Valleys Council, an issue I have been campaigning on since 2018.

“What were the reasons for the amalgamation? A report released in January 2016, apparently based on modelling from KPMG, promised a total financial benefit of $20 million over a 20‑year period, reduced reliance on rate increases, greater capacity to reduce infrastructure backlog, better strategic planning and economic development, more effective representation, and a more effective voice for the region’s interests.

“What happened to those promises? The $20 million financial benefit needed a $15 million investment over 20 years.

“ There is no sign of the benefit.

“Who would invest $15 million at that rate of return in local government?

“Rates have gone up, the community is riven by dissent, and the courageous council has been faced with enormous challenges in planning and service delivery.

“Professor Joseph Drew was commissioned by the Snowy Valleys Council to develop an evidence brief for demerger. He said:

‘Sophisticated peer-reviewed empirical work has … demonstrated that the amalgamation program … failed to achieve its stated intent in terms of both efficiency and financial sustainability.’0

“Therefore, I congratulate the Snowy Valleys Council on taking the decision at last Thursday’s council meeting to formally pursue the demerger process.

“Sensibly, the council has decided to seek further advice on the current NSW Government report for the demerger process.

“I call on the Government to support the Snowy Valleys Council in their demerger work.

“When in opposition, the Labor Party were critical of the mergers that took place and led the community to believe that they would support them in demerging.

The Labor policy platform, Better Local Governance 1.1108 reads:

‘NSW Labor will not support the forced merger of local councils, nor will it support any forced demerger. NSW Labor does not oppose the merger or demerger of councils, but insists that this must be done voluntarily with the clear support of local residents as confirmed through a local plebiscite. NSW Labor will legislate to put in place independent mechanisms to enable this to occur.’

“The Labor Party also introduced to Parliament in March 2021 changes to the Local Government Act 1993 to provide a clearly defined pathway for councils to demerge and be supported by the government of the day.

“In my view, that support includes funding the cost of the demerger process.

“I believe it would be a breach of faith with the voters of NSW and the Snowy Valleys Council area to not fund the demerger process.

“It was implied by NSW Labor, as the legislation clearly indicates.

“I, with members of the crossbench and the Labor Opposition, attended the 2021 launch of the Demerger Alliance at the Tree of Knowledge.

“I was pleased by the statements made by the then shadow Minister, the member for Campbelltown, which included, ‘Communities like all of you and right across the State should not have to pay the price for a lazy, out‑of‑touch government and their poor policies. It is grossly unfair.’

“The member for The Entrance said of the failed merger of the Central Coast Council:

‘It is not acceptable for the community to foot the bill for ideological folly of a failed council amalgamation process which the Liberals persisted with in spite of significant public opposition.’

“I agree.

“I believe that the communities of the Snowy Valleys Council formed the view that Labor would support them if they choose to demerge.

“It is my view and expectation that the Government should support councils to go through that process and, crucially, that means funding the demerger process.

“It means supporting Snowy Valleys Council and Cootamundra‑Gundagai Regional Council, a neighbouring council to my region.

“I am not saying the Government should write a blank cheque indefinitely and I do not believe it should support unviable councils.

“I understand that the policy of the Government is to have plebiscites, with the community fully informed.

“But the Government should be working with councils that want to demerge to help them to achieve it, to map a pathway forward out of the quagmire of merger madness, to right the wrongs of the failed amalgamation policy, and to respect the will of the people and help communities to once again take control of their futures.”

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